The world of precious metals gold and silver has captured investor attention for many years. In 2025 especially, these metals have been topping headlines with record rallies followed by sharp corrections. With gold and silver prices now falling again, many investors and hobby buyers are asking: Is this the time to buy – or should I hold off and wait? In this article, we’ll explore the recent price action, what’s driving it, the pros and cons of buying now vs waiting, and a framework to decide for yourself.
What’s Happening: The Current Price Drop
Gold
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According to the India Bullion & Jewellers Association (IBJA) data, 999-purity gold in India has fallen by about 6.85% in just ten days (from around ₹12,958 per gram on October 17 to ₹12,108 per gram on October 27).
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Futures on the Multi Commodity Exchange of India (MCX) show December gold futures have dropped to around ₹1,21,822 per 10 grams, a sharp correction after hitting highs.
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Globally, gold took its biggest one-day drop since 2020, losing over 5% in a session, as it fell from around US $4,381/oz to roughly US $4,082/oz.
Silver
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Silver is under even more pressure. In India, silver futures dropped sharply; for example, December silver fell by around 5.83% in one week.
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Internationally, spot silver fell from about US $54.47/oz to US $48.5/oz in just 10 days—a roughly 11% drop.
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Analysts such as those from Goldman Sachs point out that although silver soared (over 70% in 2025), it is now more vulnerable to downside risk because of weaker “central bank support”.
What Are Investors Saying?
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Many view the current pull-back as a healthy correction after a prolonged rally for example, gold once went from ~₹75,000 to ₹1.30 lakh per 10 g in a few months.
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Analysts expect consolidation in the near term and are cautioning against assuming the rally will simply continue unabated.
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The key global drivers now include the strength of the U.S. dollar, interest-rate expectations (especially of the Federal Reserve), geo‐political risk, and physical demand from major consumers like India and China.
Why Are Gold & Silver Falling? Key Drivers
Understanding the “why” is crucial before making a decision. Here are the major reasons behind the drop.
1. Profit-Booking & Overbought Conditions
After tremendous gains in recent months, many investors locked profits. A sharp drop often follows when the rally becomes “frothy”. For example, one analyst noted gold’s rally of US $1,000 in six weeks was a sign of overextension.
2. Stronger U.S. Dollar & Interest Rate Dynamics
Gold and silver are often negatively correlated with the U.S. dollar. As the dollar strengthens, precious metals become more expensive for non-USD buyers, suppressing demand. For example, the U.S. Dollar Index (DXY) rose above 106, adding pressure on gold.
Also, when real interest rates or nominal yields rise, the opportunity cost of holding non-yielding assets like gold increases.
3. Easing Geopolitical Risk & Safe-Haven Demand Dropping
Earlier in 2025, much of the rally in precious metals was driven by safe-haven buying amid inflation fears, global debt concerns, and trade tensions. As some of these pressures ease or become more stable (for now), demand moderates.
4. Supply & Demand Shifts (Especially Silver)
Silver has a significant industrial component (solar panels, electronics) as well as investment demand. Supply tightness had previously driven much of its rally. However, when investor sentiment turns or industrial demand slows, silver may correct more deeply.
5. Timing Factors in India
In India, heavy buying for festivals (Dussehra, Diwali), weddings, etc., often drives up demand for gold and silver. With festival periods behind or nearby, demand may ease temporarily and supply may catch up, leading to price relief.
Should You Buy Now or Wait? A Balanced View
The big question: with prices falling, is now the “buy” moment? Or should you wait for the market to settle or fall further? Let’s weigh both sides.
Reasons to Consider Buying Now
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Valuation Improvement
If you believe in the longer-term fundamentals (inflation hedge, currency depreciation, central bank buying), then a dip offers a better entry point than when prices were stretched.
Example: In India some analysts say the correction to ~₹1.15 lakh per 10g (from ~₹1.30 lakh) was “expected and healthy”. -
Long-Term Portfolio Inclusion
For those investing with a 5-10 year horizon, gold and silver remain important diversifiers and inflation hedges. Buying on dip can be a disciplined strategy rather than ‘chasing highs’. -
India-Specific Demand Factors
In India, physical demand (jewellery, coins, bars) remains strong. Some commentators expect that if prices fall further, buying may accelerate ahead of the next wedding/festival season.
Reasons to Wait or Be Cautious
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Uncertainty & Volatility Still High
The correction may not be over. Some predictions suggest gold could fall to ~$3,700-$3,500/oz if support fails.
With silver’s industrial demand element, it might face deeper pullbacks if global growth slows. -
Better Entry Could Be Ahead
If interest-rates rise, the dollar strengthens, or safe-haven demand vanishes further, metals may drop more, offering even better entry prices.
Some analysts expect consolidation or lower bias in the near term. -
Opportunity Cost
Precious metals don’t generate income (interest, dividends). If the metal price falls further, your capital is tied up and likely underperforming other asset classes until recovery.
My Framework: How to Decide for Yourself
Here is a simple decision-making framework you can use.
Step 1: Clarify your horizon & objective
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Are you buying for short-term gain (1-2 years) or long-term (5-10 years)?
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Are you buying for physical usage (jewellery/coins) or purely investment?
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What proportion of your portfolio is allocated to precious metals (typically 5-10% is advised)?
Step 2: Evaluate your risk tolerance
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If you are very risk-averse, waiting through more price swings may be uncomfortable.
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If you can accept medium volatility for medium-term gain, buying now may make sense.
Step 3: Monitor key triggers
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Interest-rate outlook: e.g., what the Fed is doing, real yields.
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U.S. dollar strength.
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Geopolitical risk and inflation expectations.
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India/China physical demand, festival cycles, and import duties.
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Support & resistance zones in price charts (for example, gold around ₹1.15 lakh per 10g in India).
Step 4: Entry strategy
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Stagger your entry: Instead of lump-sum, consider buying in tranches (e.g., 50% now, 50% later).
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Target zone: If you believe the support zone is around ₹1.15 lakh/10g for gold in India, you might wait for that level before topping up.
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Physical vs paper: Decide if you want physical bars/coins (costs, storage) or gold ETFs/digital gold (easier, may have fees).
Step 5: Exit or stop-loss plan
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Set a target or a stop-loss. For example, if gold falls below $3,700/oz globally or ₹1.10 lakh/10g locally and you’re uncomfortable, you may pause buying.
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Re-assess when your fundamental view changes (e.g., interest rates move unexpectedly, or macro sentiment shifts).
Specific Thoughts on Gold vs Silver
Gold
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More stable, more widely held, has central-bank support.
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Good hedge against inflation, currency risk.
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Correction is significant now, so buy-on-dip makes sense if you believe in medium-long-term trend.
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But waiting for a lower level (if it falls further) might yield better price.
Silver
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Higher upside potential (rallied more in 2025) but also higher risk (more industrial use, less institutional support).
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If you believe in ongoing industrial demand (solar, electronics, EVs), silver could be a buy at dip. But you must accept greater volatility.
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Analysts say silver is “turbocharged gold” if things go right big gains; if wrong, bigger losses.
What to Watch in the Coming Weeks & Months
Keep an eye on the following:
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U.S. Fed monetary policy: Any signals of rate cuts, inflation data, or real-yield shifts will affect metals.
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Dollar index movement: Revival in dollar weakens metals (as seen recently).
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India/China buying: Since India and China drive large physical demand, their festival seasons, wedding demand and import policies impact prices.
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Supply-chain issues: Especially for silver industrial demand and supply tightness can cause big moves.
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Geopolitical risk: Renewed tensions (Middle East, trade wars) often boost safe-haven demand for gold.
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Technical levels: For gold, support around ₹1.15 lakh/10g or ~$3,700-$4,000/oz globally. For silver, watch $47-$50/oz area.
My Take: What I Would Do If I Were You
If I were in your shoes (with normal risk tolerance, a medium-term horizon of say 5 years, and gold as ~7% of portfolio), here’s what I’d do:
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I’d buy a portion of my target allocation now, because the price drop provides a better entry than the peak.
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I’d reserve some cash for potential further drop (because the correction may not be over).
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I would favour gold slightly more than silver for stability, but also keep a small exposure to silver if I’m comfortable with risk.
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I would choose low-cost instruments (e.g., gold ETFs, digital gold) unless I particularly want physical.
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I’d schedule a review in say 3-6 months to see if the metal has stabilized or if further fall makes sense.
If I had to wait, I might set a condition: “If gold falls to ₹1.10 lakh/10g or silver to ₹1.35 lakh/kg in India, I’ll buy a significant portion.” That way I don’t miss out entirely but I also guard for better discount.
Gold and silver prices are falling and for many, that may feel like a lost opportunity. But in fact, a price drop can present a buying opportunity, if you have the right horizon and reasons. The “right” time depends heavily on your personal goals, risk tolerance, and belief in the longer-term role of these metals.
If you believe in inflation, currency risk, and safe-haven demand persisting, then buying now (or in tranches) may make sense. If you’re more cautious, you may wait for further confirmation or lower levels. The key: don’t be swayed by headline price swings alone define your strategy, pick your entry, and stick to your plan.
Remember: precious metals are part of the portfolio, not the whole portfolio. Use them to hedge, diversify, and balance not to speculate heavily unless you are comfortable with into-the-weeds market risk. To know more about investment Subscribe Jatininfo.in now.
