Silver rebounds to Rs 2.64 lakh/kg amid US–Iran tensions, thin global trade; traders flag key support levels

Silver prices surged more than 7 per cent in the national capital on Thursday, rallying sharply as investors turned to safe-haven assets amid escalating geopolitical tensions between the United States and Iran. Thin global liquidity conditions due to the Lunar New Year holidays further amplified price volatility in bullion markets.

According to local bullion traders, silver climbed Rs 18,000, or 7.32 per cent, to Rs 2,64,000 per kilogram (inclusive of all taxes), compared with Rs 2,46,000 per kg in the previous session, news agency PTI reported. The sharp rebound reflects renewed buying interest after recent corrective moves from record highs. In the international market, spot silver was trading 1.03 per cent higher at $77.97 per ounce, tracking firm global commodity trends as investors adopted a risk-off approach.

Siddhartha Khemka, Head of Research, Wealth Management at Motilal Oswal Financial Services, said geopolitical uncertainty had pushed investors toward defensive assets. “Market sentiment turned cautious amid rising geopolitical tensions, following concerns over a potential conflict between the US and Iran and speculation of possible military action over the weekend. Reflecting the risk-off mood, global commodity prices moved higher, with Brent crude rising over 1%, while gold and silver gained ~0.3% and 1%, respectively.”

While the immediate trigger has been geopolitical risk, analysts note that silver remains in a broader corrective phase following its earlier spike to record highs. Ponmudi R, CEO of Enrich Money, outlined key technical levels to watch.

“MCX Silver futures are trading near the Rs 2,30,000–Rs 2,50,000 zone after a sharp correction from record highs around Rs 4,20,000. While the long-term bullish structure remains intact, the steep pullback has pushed prices below major moving averages, indicating short-term bearish pressure and an ongoing corrective phase. Strong buying interest is evident in the Rs 2,25,000–Rs 2,35,000 support band, aligned with prior swing lows and longer-term structural support. A sustained hold above this base, followed by a decisive recovery, could revive upward momentum toward Rs 3,00,000–Rs 3,25,000. Dips toward support continue to offer accumulation opportunities for positional traders, though a decisive break below these levels could accelerate downside pressure and extend the correction.”

Seasonal and holiday factors

Seasonal factors have also shaped silver’s price action this week. The Lunar New Year holidays have shut several major Asian exchanges, including mainland China and Hong Kong, sharply reducing global trading volumes. With China being the world’s largest consumer of silver for industrial applications such as solar panels, electronics, and electric vehicles, reduced participation has thinned liquidity and widened price swings.

Aamir Makda, Commodity & Currency Analyst at Choice Broking, cautioned traders about heightened volatility during this period. “Silver is particularly vulnerable during this timeframe compared to gold; because Chinese industrial production hits a standstill during the festivities, the dramatic drop in manufacturing demand makes silver prices much more susceptible to a sharp decline. With this perspective, it is advised to traders to avoid taking trades in bullion.”

Market experts say such volatility during holiday-driven liquidity gaps is often seasonal. Once Asian markets resume normal operations, price discovery typically stabilises, though geopolitical developments may continue to influence the broader trend.