Gold and Silver Prices Experience Sharp Decline Amid Geopolitical Developments
The precious metals market witnessed a significant downturn on Friday, with both gold and silver prices plunging as geopolitical tensions between the United States and Iran showed signs of easing. This shift has bolstered the US Dollar, diminishing the appeal of traditional safe-haven assets like gold and silver.
COMEX Metals Suffer Technical Breakdown
COMEX gold rates experienced intense selling pressure, breaking below the crucial support level of $4,750 per ounce. The metal touched an intraday low of $4,671.74 per ounce, marking a substantial decline from recent highs. Similarly, COMEX silver rates collapsed below the $70 per ounce threshold, plummeting to an intraday low of $63.900 per ounce. This represents a dramatic drop of approximately 10% in silver values within a very short trading period.
Market analysts attribute this sudden downturn to a technical breakdown that occurred mere minutes after the Opening Bell, extending what has now become a two-session losing streak for both precious metals.
Indian Market Shows Mixed Performance
On the Multi Commodity Exchange (MCX), the picture was somewhat different though still concerning for investors. The gold futures contract for April 2026 expiry settled at ₹1,52,260 per 10 grams on Thursday. While this represents a marginal increase from previous sessions, it remains significantly below the record high of ₹1,80,779 per 10 grams achieved just last week.
MCX silver rates followed a similar pattern, closing at ₹2,46,452 per kilogram on Thursday. This level sits approximately ₹1,73,500 below the all-time peak of ₹4,20,048 per kilogram recorded recently. The rapid descent from record highs to current levels has occurred within just four trading sessions, highlighting the volatility currently characterizing the precious metals market.
Geopolitical Factors Driving Market Movements
The primary catalyst for this precious metals selloff appears to be the scheduled resumption of nuclear negotiations between the United States and Iran. Diplomatic talks are set to recommence on Friday in Oman, marking a return to dialogue that was previously disrupted by Israel's military actions against Iran in June and subsequent domestic unrest in Iran.
"Gold and silver rates are under pressure because of the easing US-Iran tension," explained Anuj Gupta, a SEBI-registered market expert. "Both countries have announced that they will initiate talks for a possible nuclear deal. The first US-Iran talks are taking place on Friday this week. This has fueled demand for the US Dollar against major global currencies and hit the safe-haven demand for gold and silver."
The diplomatic developments come amid heightened political tensions, with former US President Donald Trump reportedly increasing pressure on Iran and warning of potential military consequences. The resumption of nuclear negotiations has reintroduced Iran's nuclear program as a central foreign policy issue after months of regional escalation.
Dollar Strength Undermines Precious Metals
Market experts consistently point to the strengthening US Dollar as the mechanism through which geopolitical developments are affecting precious metals prices. As tensions ease between the US and Iran, investors are shifting away from safe-haven assets and toward the US currency, which typically gains strength during periods of reduced global uncertainty.
This flight to the Dollar has created a double impact on gold and silver: reducing direct investment in these metals while simultaneously making them more expensive for holders of other currencies, further suppressing demand. The combination of these factors has created perfect conditions for the sharp declines witnessed in Friday's trading session.
The precious metals market now faces a critical juncture, with further price movements likely to be dictated by the progress of US-Iran negotiations and corresponding fluctuations in Dollar strength. Investors and market watchers will be closely monitoring both the diplomatic developments and technical support levels to gauge the next direction for gold and silver prices.
