Losing Sheen
Gold, silver post sharpest fall in a decade on profit sales, margin hikes
This story was originally published at 11:42 IST on 2 February 2026
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Informist, Monday, Feb. 2, 2026
MUMBAI – Precious metals recorded the steepest decline in over a decade after a sharp rally due to multiple factors. The prices of precious metals fell as profit-taking intensified after gold and silver futures contracts on COMEX touched record highs and momentum began to cool, Ajay Kedia, director, Kedia Advisory said in a note. Prices fell further as the Chicago Mercantile Exchange raised margin requirements on gold and silver, triggering liquidation by leveraged traders.
On Monday, the Chicago Mercantile Exchange increased the margin requirements for gold and silver futures contracts. For non-heightened risk profiles, gold futures margins have been increased to 8% from 6%. For heightened risk profiles, the margins have been raised to 8.8% from 6.6%. Silver futures margins for non-heightened risk profiles have been increased to 15% from 11%. For heightened risk profiles, the margins have been raised to 16.5% from 12.1%.
The exchange raised the margins on gold and silver futures "as per the normal review of market volatility to ensure adequate collateral coverage," it said in a release on Friday.
Prices also fell due to easing geopolitical risks after signals of potential US–Iran negotiations reduced safe-haven demand, Kedia said. On Sunday, US President Donald Trump said Iran was "seriously talking" with Washington, just hours after Tehran's top security official, Ali Larijani, wrote on social media platform X that preparations for negotiations were in progress, Reuters reported. Gold and silver-exchange traded funds also saw heavy outflows, leading to price corrections of up to 20%, Kedia said.
The downside was also compounded by a stronger US dollar, Kedia said. On Monday, the dollar index remained above 97 after zooming over 1% Friday following Trump's nomination of Kevin Warsh as the next US Federal Reserve Chair. Commentary by other Fed officials and higher producer prices also suggested interest rates in the US were not going down in a hurry. Typically, higher interest rates dent demand for non-yielding precious metals.
At 1120 IST, the April gold contract on COMEX was down 2% at $4,631.5 per ounce. At 1121 IST, the most-active March silver contract on COMEX was down 4% at $75.38 per ounce. Support for gold on the COMEX is seen at $4,280 per ounce and resistance at $5,020 per ounce. For silver, support is seen at $70 and resistance at $92.20 per ounce, according to Kedia. End
US$1 = INR 91.73
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Reshma Ravi
Edited by Vandana Hingorani
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