Gold and silver prices have witnessed extreme volatility in recent weeks, surging to record highs within a short span before crashing sharply. Last week, gold prices soared to an all-time high of $5,594.82 per ounce, while silver touched a record $121.64. However, the sharp rally proved short-lived.
Gold prices have now slipped to around $4,917 an ounce level, and silver price has corrected steeply to near $75 an ounce, wiping out a significant portion of recent gains. These sharp swings in gold and silver prices have prompted ace investor Vijay Kedia to caution that the rally was driven largely by speculators rather than long-term investors.
In a recent viral video circulating on X, Kedia was seen reacting to the volatility in gold and silver prices during an interview. Kedia said the recent surge in precious metals was speculative in nature. “These are not investors driving the market, but speculators,” he remarked, warning that such rallies often end in painful corrections.
Drawing parallels with history, Kedia referred to the infamous 1980 “Silver Thursday” episode involving the Hunt Brothers. In the late 1970s, the Hunt Brothers attempted to corner nearly one-third of the global silver supply, pushing silver prices from around $1.50 per ounce to nearly $50. Regulatory intervention eventually forced liquidation, causing silver prices to crash to $6 and triggering widespread market turmoil.
The episode led to strict position limits, and silver took nearly 40 years just to return to $50 in dollar terms.
Kedia pointed to a similar pattern in 2011, when silver rate crossed the $50 mark only to collapse to around $11 in the following years. “In 2025, silver again crossed $50. In 2026, speculators pushed it near $125. Now prices are crashing again,” Kedia said, underlining the cyclical nature of speculative excesses in commodity markets.
From Speculators to Investors
Taking a light-hearted dig at market participants, Kedia quipped that many traders initially enter as speculators but rebrand themselves as investors once prices fall. “First they speculate. When prices crash, they say they have invested,” he said.
Using a metaphor to describe the current trend, Kedia added, “Metals are meant to melt when there is too much heat.” According to him, the sharp correction underway in gold and silver prices is a natural outcome of excessive speculation.
Precious metals had rallied strongly last month amid a mix of speculative buying, heightened geopolitical tensions, and growing unease over the independence of the US Federal Reserve. However, the momentum reversed abruptly late last week. Silver recorded its steepest single-day fall on Friday, while gold suffered its sharpest decline in over a decade.
Kedia’s comments serve as a reminder that while precious metals are often viewed as safe-haven assets, sharp, parabolic moves are rarely sustainable — and investors should be wary of confusing speculative rallies with long-term value.
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