Why Have Silver Prices Dropped Nearly 3.5% on MCX?
Synopsis
On January 8, silver prices experienced a dramatic decline of 3.5% on MCX amidst increased selling pressure linked to global commodity index rebalancing and critical US economic data imminent release. This article delves into the market dynamics influencing this volatility.
Key Takeaways
Silver prices fell by 3.5% on MCX due to increased selling pressure.
Prices traded below Rs 2,42,000 per kilogram.
Market volatility is expected to continue with upcoming US economic data.
Silver's accumulation zone is noted between Rs 2,45,000 and Rs 2,48,000 .
In international markets, COMEX silver showed slight recovery.
Mumbai, Jan 8 (NationPress) Prices of silver witnessed a significant decline on Thursday, experiencing a drop of nearly 3.5% as selling pressure mounted in anticipation of the annual rebalancing of global commodity indexes and the upcoming release of crucial US economic data.
On the Multi Commodity Exchange (MCX), silver was traded below Rs 2,42,000 per kilogram during the trading session.
This downturn followed expectations that passive investment funds would decrease their holdings in precious metals futures to align with new index weightings.
The selling activity has been notably intense, especially after the robust rally of gold and silver in prior months.
As this article was being composed, silver fluctuated between an intra-day low of Rs 2,48,163 and a high of Rs 2,51,889, compared to the previous closing of Rs 2,50,605.
In the preceding trading session, MCX silver had already seen a sharp decline, dropping by as much as Rs 11,700 per kilogram to reach a low of Rs 2,47,100.
“In INR, gold has support levels between Rs 1,36,550 and Rs 1,35,310, with resistance at Rs 1,39,350 to Rs 1,40,670,” stated an expert.
“For silver, support is noted at Rs 2,46,810 and Rs 2,42,170, while resistance is at Rs 2,55,810 and Rs 2,58,470,” the analyst added.
The primary accumulation zone remains between Rs 2,45,000 and Rs 2,48,000, underscoring silver’s status as a high-beta performer within the precious metals sector, according to market observers.
In international markets, COMEX silver showed minor recovery. Prices reversed early gains and were trading slightly up at $77.780 per ounce.
Earlier in the session, silver had surged to an intra-day high of $78.875 per ounce, achieving an approximate gain of 1.5% following Wednesday’s sell-off.
“A decisive breakout above $4,500 could swiftly lead towards $4,550 to $4,600. The $4,400 to $4,420 zone remains an appealing risk-reward accumulation area, with no higher-timeframe reversal signals apparent,” noted a market analyst.
Market participants are exercising caution as flows related to index rebalancing and forthcoming US economic data are likely to keep silver prices fluctuating in the short term.
Point of View
My perspective aligns with our commitment to providing well-rounded and trustworthy insights. The fluctuations in silver prices are significant and warrant close attention from investors. We stand by our promise to deliver timely updates that reflect the realities of the financial markets.
NationPress
9 May 2026
Frequently Asked Questions
What caused the recent drop in silver prices?
The recent drop in silver prices is primarily due to increased selling pressure related to the annual rebalancing of global commodity indexes and the anticipated release of key US economic data.
What were the trading levels for silver on MCX?
During the trading session, silver prices on MCX dropped to below Rs 2,42,000 per kilogram, with intra-day fluctuations noted.
Is this decline typical for silver in January?
While fluctuations are common, the significant drop of 3.5% is noteworthy and can be attributed to specific market conditions and investor sentiments.
