What is the story about?
Gold and silver prices have eased from recent record levels, prompting investors to evaluate whether the correction offers a buying opportunity or signals a period of consolidation after an exceptional 2025 rally.
Kelvin Wong, Senior Market Analyst at OANDA, said the recent pullback reflects technical unwinding after prices became stretched.
He noted that the sharp rise over the past week left precious metals vulnerable to downside pressure as leveraged long positions were squeezed, pushing momentum indicators out of overbought territory.
In the domestic market, bullion prices showed limited movement rather than sharp declines. Gold prices remained broadly steady across purity levels, while silver posted marginal losses across standard traded quantities, mirroring global caution rather than aggressive selling.
Ross Maxwell, Global Strategy Operations Lead at VT Markets, said gold remains better positioned as a core allocation heading into next year due to its stability and support from macroeconomic risks.
He highlighted gold’s role as a monetary hedge and ongoing interest from central banks, adding that silver offers higher upside potential but with significantly greater volatility due to its dependence on industrial demand.
Rahul Kalantri, VP Commodities at Mehta Equities, attributed the recent volatility to technical factors, including stretched long positions and higher margin requirements imposed by the CME, which triggered position reductions during thin holiday trading.
He added that geopolitical tensions could provide underlying support to bullion prices at lower levels.
While silver has outperformed gold by a wide margin in 2025, analysts caution that its higher sensitivity to economic growth makes it more prone to sharp corrections. Gold, by contrast, is expected to see steadier institutional demand if concerns around fiscal stability, currency credibility, or geopolitical risk persist.
Market experts broadly agree that the current decline does not undermine the longer-term outlook for precious metals. Instead, they view the correction as a potential opportunity for selective accumulation, particularly in gold, provided macroeconomic uncertainties and expectations of lower real interest rates remain intact.
-With Reuters inputs
Kelvin Wong, Senior Market Analyst at OANDA, said the recent pullback reflects technical unwinding after prices became stretched.
He noted that the sharp rise over the past week left precious metals vulnerable to downside pressure as leveraged long positions were squeezed, pushing momentum indicators out of overbought territory.
In the domestic market, bullion prices showed limited movement rather than sharp declines. Gold prices remained broadly steady across purity levels, while silver posted marginal losses across standard traded quantities, mirroring global caution rather than aggressive selling.
Ross Maxwell, Global Strategy Operations Lead at VT Markets, said gold remains better positioned as a core allocation heading into next year due to its stability and support from macroeconomic risks.
He highlighted gold’s role as a monetary hedge and ongoing interest from central banks, adding that silver offers higher upside potential but with significantly greater volatility due to its dependence on industrial demand.
Rahul Kalantri, VP Commodities at Mehta Equities, attributed the recent volatility to technical factors, including stretched long positions and higher margin requirements imposed by the CME, which triggered position reductions during thin holiday trading.
He added that geopolitical tensions could provide underlying support to bullion prices at lower levels.
While silver has outperformed gold by a wide margin in 2025, analysts caution that its higher sensitivity to economic growth makes it more prone to sharp corrections. Gold, by contrast, is expected to see steadier institutional demand if concerns around fiscal stability, currency credibility, or geopolitical risk persist.
Market experts broadly agree that the current decline does not undermine the longer-term outlook for precious metals. Instead, they view the correction as a potential opportunity for selective accumulation, particularly in gold, provided macroeconomic uncertainties and expectations of lower real interest rates remain intact.
-With Reuters inputs
