Gold and silver crash after historic rally: Should you buy, sell or hold?

After hitting record highs earlier this year, gold and silver prices are now witnessing a sharp correction, leaving investors uncertain about whether to sell, hold, or buy.

Since the start of 2026, precious metals had been on a strong upward trajectory, with gold gaining in double digits and silver surging over 50 per cent. Last Thursday, both metals reached all-time highs in international markets.

However, the rally reversed dramatically over the past few days. Gold, which had climbed to nearly USD 5,600 per ounce, slipped to the USD 4,500–USD 4,700 range, marking a decline of up to eight per cent. In India, 24-carat gold fell from around Rs 1.69 lakh to approximately Rs 1.51 lakh per 10 grams.

Silver experienced an even sharper fall. After touching USD 121 per ounce, it plunged over 30 per cent — the steepest decline since 1980. In India, silver prices dropped from Rs 4.20 lakh to nearly Rs 3.45 lakh per kilogram.

Gold and silver ETFs also felt the impact. Gold ETFs fell by up to six per cent, while silver ETFs dropped as much as 15 per cent, prompting exchanges to impose circuit limits to curb extreme volatility.

Experts attribute the sell-off to a combination of profit booking, a stronger US dollar, and uncertainty following the nomination of Kevin Warsh as Federal Reserve chair, known for his hawkish stance on inflation. Adding to the pressure, the CME Group raised margin requirements on gold and silver futures, triggering forced liquidations in global markets.

Despite the correction, many analysts remain bullish on gold. JP Morgan projects gold prices could reach USD 5,000–USD 6,300 per ounce by the end of 2026, supported by central-bank purchases and geopolitical tensions. Gold continues to be seen as a reliable hedge for long-term investors.

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Silver, however, is likely to remain more volatile. With no central-bank support and a smaller market size, experts advise investors to exercise caution. Some recommend trimming overexposure, while others suggest that the correction is a healthy adjustment and silver may hold above current levels.

Long-term gold investors may consider holding or accumulating gradually, whereas silver investors are advised to reassess their risk and exposure carefully amid ongoing volatility.