The bubble of bullion and silver prices burst when there was a sudden decline in the prices of these precious metals in the last 24 hours. Gold and silver fell far below their all-time prices, causing a huge blow to investors.
At the same time, this is a news of relief for people who are planning to buy gold and silver during the wedding season. Silver registered a huge fall of Rs 85000 per kg in 24 hours. After touching the price of Rs 4.20 lakh per kg on Thursday, March futures silver on MCX fell to Rs 3.35 lakh at 3.30 pm.
At the same time, the price of gold also fell significantly on Friday. After reaching the price of Rs 193,096 per 10 grams, gold fell by Rs 25,500 and reached Rs 1,67,406. The sudden crash spooked investors, while jewelers and small buyers heaved a sigh of relief.
Why was there such a huge decline?
On Thursday, silver had crossed the four lakh mark for the first time in the futures market and jumped to Rs 4.20 lakh, while gold had also made a new record with a rise of Rs 16,000. But on Friday, heavy selling for profit booking took away all the shine from the market. Market experts believe that after the continuous rise, investors started cutting profits at the peak, due to which the pressure increased.
Silver also fell due to this reason
Short sellers were especially active in silver, which deepened the fall. The strengthening of the dollar in global markets, reduction in geopolitical tension and signals from the US Federal Reserve also reduced the demand for safe investments. ETF investors were also not spared from this shock. By the time the stock market closed, ICICI Silver ETF fell by 20 per cent, while Nippon India and Tata Silver ETFs also suffered double digit losses. Gold ETFs also slipped by 10-15 per cent.
The fall in retail prices at Delhi, Mumbai and other bullion centers also provided an opportunity for buying, but the possibility of fluctuations remains. Analysts say that US politics and global economic indicators will continue to influence the market. Investment advisors have warned that this decline could be a golden buying opportunity, but avoid haste. Long-term investors can deposit gold and silver at cheap prices, while short-term traders were advised to remain cautious.