The ongoing sell-off in silver prices deepened in Friday’s session, as investors continued to dump the white metal aggressively, causing it to erase all of its early-2026 gains. Silver prices traded in the negative territory for the year.
The March delivery futures contract on MCX fell another ₹14,628 per kilogram to an intraday low of ₹2,29,187 and is testing this week’s low of ₹2,25,805. This took the week-to-date decline to ₹27,852, or 10.52%, adding to last week’s fall of ₹28,453 per kilogram.
Silver, which had enjoyed a record-breaking rally until January 2026, with prices surging past ₹4.20 lakh per kilogram on optimism around its dual appeal as a safe haven and an industrial metal, is now struggling to find the floor.
The recent crash has also brought the prices to correct 45.6% from the peak in just seven trading sessions (taking today’s low into account), which is twice that of gold’s 17.35% fall from the peak.
Is silver paying the price for an overheated run-up?
Explaining the key reason behind the extreme correction in silver prices, Akshat Garg, Head of Research & Product of Choice Wealth, said, silver, by nature, reacts more sharply than gold. It is a smaller and thinner market, so when selling starts, the fall looks steeper.
“Silver has come off mainly because it had run up too fast in a short period. Over the past year, prices had moved sharply higher, and a lot of optimistic positioning had already been built in. When markets are stretched like that, even small changes in global cues can trigger a correction. Right now, a slightly stronger dollar and some cooling in global risk appetite are prompting investors to cut exposure to volatile assets,” Garg stated.
He also noted the sharp correction in silver ETFs since they track spot prices closely. During such phases, short-term selling and lower liquidity can make ETF prices look even weaker. This is more about price adjustment and profit-booking than any sudden deterioration in silver’s fundamentals, according to the expert.
Nirpendra Yadav, Senior Commodity Research Analyst at Bonanza, said such corrections after extended rallies are common. “Broader risk sentiment and geopolitical cues can prompt profit booking in commodities, especially where positioning has been crowded.”
What investors should do amid heightened volatility?
While silver prices have corrected sharply, analysts said there is no reason for panic, even as they underscored the inherently volatile nature of the metal.
Yadav said that the industrial demand for silver remains strong, and a tight supply environment and deficits persist globally, which supports price stability over the medium-to-long run despite volatility.
He said that investors should not let a sharp fall in silver on intraday shape their long-term view.
According to Garg, too, one correction does not alter silver’s long-term relevance, but it does highlight why position sizing is critical.
He advised investors to avoid chasing prices or reacting to day-to-day movements, noting that silver works best as a small, supporting allocation within a portfolio rather than as a core holding. He added that for investors seeking exposure, staggered buying is a far more sensible approach than lump-sum investing, especially during highly volatile phases.
For short-term traders, Garg emphasised that risk management is essential, while for long-term investors, the current phase calls for patience and discipline rather than immediate action. He pointed out that the ongoing decline is being driven more by market positioning and global macro adjustments than any breakdown in silver’s long-term fundamentals.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
