Silver prices witnessed a sharp reversal on Monday, falling over 5% intraday after hitting an all-time high during early trading on the Multi Commodity Exchange of India (MCX).
Earlier this morning, trading in silver contracts was temporarily halted after the metal hit its upper circuit limit of 4%, with no sellers in sight. The SILVER1! contract last traded at Rs 1,60,830 per kilogram, while other variants including SILVERM1!, SILVERMIC1!, and SILVER2! were also frozen at similar levels.
The surge was attributed to heightened volatility in global silver prices and tight physical supply, leading the MCX to raise margins by 1% on gold and 1.5% on silver to manage risk. The exchange later cited “backwardation between futures and spot prices” in global markets — a condition where spot prices exceed futures prices, signaling supply pressure and speculative froth.
Following the morning’s rally, silver futures for December delivery, which had touched Rs 1,62,700 per kilogram, slipped sharply to Rs 1,54,111, marking a 5% correction from peak levels.
According to Riya Singh, Research Analyst – Commodities and Currency at Emkay Global, the pullback is a technical correction after an extended rally:
“Silver has surged sharply as investors rotate out of the dollar into tangible assets. Tight supply, festival demand, and premiums of up to 15% in India have fueled the rally, but any cooling in inflows could trigger swift corrections.”
She added that silver is likely to maintain an upward trajectory toward Rs 1,65,000–1,85,000 levels domestically, with key support near Rs 1,53,000–1,50,000.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Precious metal prices are subject to market volatility. Always verify rates with authorized dealers or consult a financial advisor before making investment decisions.
