Silver crashes ₹1.28 lakh from peak in 1 day: Should you bet on gold now?

Silver futures, which touched a peak of ₹4.2 lakh a kg on Thursday, fell 30% to ₹2.92 lakh in a day. Gold also weakened by 17.53%, but silver lost more. Are we seeing a 1980s redux?

Silver prices rose sharply for a few days, only to fall even faster. From a Thursday peak of ₹4.2 lakh per kg, they declined by about 30 pecent on Friday to ₹2.92 lakh — giving up in a single day more what the white metal had gained over the previous 10 days. The sharp drop has prompted comparisons with the 1980s, when silver prices surged rapidly before collapsing.

 

Silver has fallen more steeply than gold, sharpening the question for investors: Where should they place their bets — gold or silver?

 

Down ₹1,28,126 from peak

 

On Thursday, the benchmark March silver contract on the Multi Commodity Exchange of India (MCX) touched a record high of ₹4,20,048 per kg. Within a day, it fell by ₹ 1,28,126 around 30 pecent  — to ₹2,91,922 per kg. The slide was visible overseas as well. On New York’s Commodity Exchange (Comex), silver fell from a peak of $121.79 to $95.12 per ounce.

 

Gold also tumbles

 

Along with silver, gold prices also dropped sharply on Friday, weakening by more than ₹ 31,700 from its peak. On the MCX, the benchmark February gold contract had hit an all-time high of ₹1,80,779 per 10 grams on Thursday. On Friday, it touched an intraday low of ₹1,49,075 – a fall of ₹ 31,704 (17.53 per cent) over the previous day.

 

On Comex, gold fell from a peak of $5,586.20 by $ 774 (13.86 per cent) to $4,811.90 per ounce.

 

How much can gold and silver fall now?

 

The fall has unsettled investors. The key question now is whether gold and silver have already peaked, or whether there is still room for another leg up. Experts are advising caution.

 

Ajay Kedia, director at Kedia Advisory, said the gold-silver market had seen unusually sharp moves over the past week. Prices jumped suddenly and then fell sharply on Friday due to profit-taking. While the underlying supporting factors remain, he said prices had already risen too much. In his view, the rally in both gold and silver looks excessive, making it prudent to be cautious on fresh buying and to protect profits already made.

 

Kedia said silver could fall to $78, while gold could decline to $4,860, though he expects gold to find support around $4,240.

 

Vandana Bharti, research head (commodities) at SMC Global Securities, said silver could fall to ₹3.20 lakh per kg and gold to ₹1.42 lakh per 10 grams in the domestic market over the next week. On comparisons with the 1980s, she said silver had seen a sharp drop, but not on the scale seen then, and it would be premature to conclude at this stage that the current situation could mirror 1980.

 

Should investors bet on gold or buy silver?

 

After Friday’s sharp fall, sentiment in precious metals appears to be turning quickly. In recent days, silver had outpaced gold. Now, both metals are in a steep correction from their record highs, prompting investors to reassess whether to back gold or silver.

 

Kedia Advisory’s report said January 2026 was exceptional. Gold rose about 28 per cent for the month — something last seen in January 1980 — while silver surged around 70 per cent, its fastest monthly gain so far. After such a sharp rally, the report said, a correction was widely seen as almost inevitable.

 

From recent highs, gold has fallen about 13.86 per cent to around $ 4,811.90 per ounce, while silver has declined more — about 30.50 per cent — to $ 84.63per ounce. The sharper fall in silver underscores its higher volatility. The report said a similar pattern played out in the 1977-1980 and 2008-2011 cycles.

 

After 1980, gold fell about 66 per cent, while silver dropped around 90 per cent. In the 2011 cycle, gold declined about 38 per cent and silver fell over 60 per cent — reinforcing the pattern that silver tends to fall more than gold in downturns.

 

The gold-silver ratio is also being watched as a key signal. The report said the ratio had tightened to around 45 from 107 last year amid geopolitical tensions, but such a low ratio has not historically been considered sustainable. Analysts cited in the report expect a move back towards 70-72, meaning gold’s performance could be stronger than silver’s.

 

Experts quoted in the report said the correction did not weaken the long-term bullish case for gold. Factors such as central bank buying, geopolitical uncertainty, currency risk and limited supply remain supportive. The report suggested that, rather than exiting precious metals, investors might consider tilting from silver to gold. Profit-taking in silver, or a partial shift, could offer better protection during a correction, given silver’s higher risk. It added that discipline and tracking the gold-silver ratio would remain important.

 

Kedia also urged investors to focus on protecting profits amid multiple risk factors, including rising US-Iran tensions, fears of a tariff war, uncertainty around the Union Budget, outflows from exchange-traded funds (ETFs), a stronger dollar, and higher margins that can amplify volatility.

 

The Hunt Brothers episode of the 1980s

 

In the 1970s, the world’s largest economy was in flux. US President Richard Nixon ended the gold standard in 1971, breaking the link between the US dollar and gold. Inflation squeezed households, and economic instability deepened.

 

Against that backdrop, two wealthy US businessmen — brothers Nelson Bunker Hunt and William Herbert Hunt — began betting heavily on silver. What started as a safe-haven trade soon turned speculative. Between 1973 and 1979, the Hunt brothers amassed record quantities of the metal. By 1979, they reportedly held about 200 million ounces — roughly one-third of global non-government silver stocks — and built large futures positions too.

 

The buying spree sent silver soaring from $1.95 per ounce in 1973 to nearly $50 by January 1980 — about a 25-fold jump. Regulators then stepped in and imposed tighter margin requirements, triggering a crash. On March 27, 1980, silver plunged about 50 per cent in a single session — from around $21 to below $11 per ounce. The day is remembered as “Silver Thursday”.