Gold, Silver Crash: MCX Rates Below ₹1.61 Lakh as Dollar Hits 3-Month High

The “safe-haven” rally of the past week has hit a major roadblock. On Monday, March 9, 2026, gold and silver prices in India witnessed a sharp sell-off as a resurgent US dollar and a spike in Treasury yields dampened the appeal of non-yielding assets. Despite the escalating US-Israel-Iran war, the immediate market reaction has pivoted toward the economic fallout of the conflict—specifically, the threat of persistent inflation driven by energy costs.

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The “Greenback” Pressure: Dollar & Yields

The primary culprit behind today’s bullion crash is the strengthening US dollar.

• Dollar Index: The index rose to 99.695, punishing buyers using the Indian Rupee (which also hit a record low of 92.33 today).

• 10-Year Yields: US Treasury yields climbed to a one-month high. When yields rise, the “opportunity cost” of holding gold—which pays no interest—increases, leading investors to move capital back into bonds.

Inflation vs. Rate Cuts: The Crude Oil Trigger

While the Iran war typically drives gold up, the 50% surge in oil prices this month has created a “double-edged sword” effect.

• Delayed Rate Cuts: High oil prices mean higher inflation. This has led the market to believe the US Federal Reserve will keep interest rates steady for longer.

• FedWatch Data: Odds of a rate “hold” in June have jumped from 43% last week to over 51% today.

Technical Outlook: Support and Resistance Levels

Analysts are now suggesting a “sell on rise” strategy as the technical indicators turn bearish.

• MCX Gold: Currently trading near ₹1,60,000. Ajay Kedia of Kedia Advisory suggests support is at ₹1,58,700, with resistance at ₹1,61,700.

• Spot Gold: Support is seen at the $5,020 level. If this breaks, the downward momentum could intensify.

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Other Commodities: Aluminum Peaks, Platinum Slides

While precious metals fell, industrial metals reacted differently to the war.

• Aluminum: Hit a four-year high on the LME at $3,544 per ton due to supply chain fears.

• Platinum & Palladium: Both followed gold lower, with Platinum dropping 3.8% to $2,054.65.

Reality Check

Gold has corrected today, but it remains up roughly 54% year-to-date. Still, the current volatility means that the “easy gains” of the early war phase are over. Therefore, while gold is a long-term hedge, the immediate technical trend is negative. In fact, if the $1,58,700 support level breaks on MCX, we could see a rapid descent toward the ₹1.55 lakh zone.

The Loopholes

The market is worried about inflation. In fact, this is a “Liquidity Loophole”—when crude oil spikes too fast, it forces a “risk-off” liquidation across all asset classes, including gold and Bitcoin, as investors scramble for cash (US Dollars) to cover margins. Therefore, gold isn’t acting as a “safe haven” today because the dollar is acting as a “safer” one. Still, the “Central Bank Loophole” remains; despite the price drop, central banks in Asia continue to buy on dips, which will likely provide a hard floor for prices by the end of the month.

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What This Means for You

If you are a retail investor, do not panic-sell, but avoid “catching a falling knife.” First, realize that the current dip is driven by currency fluctuations, not a lack of geopolitical risk. Then, if you were planning to buy jewelry, understand that ₹1.59 lakh – ₹1.60 lakh is a significant psychological entry point.

Finally, understand that Gold ETFs and Sovereign Gold Bonds are safer than physical gold during high-volatility weeks. You should wait for the ₹1,58,700 support to hold before making a fresh bulk investment. Before you trade, check the “US-Iran War” news cycle; any sudden escalation tonight could reverse these losses in the Tuesday morning session.

What’s Next

The US economic data releases later today will provide more clarity on the Fed’s next move. Then, look for the MCX evening session to see if domestic buyers return at lower levels. Finally, expect Gold to trade in a volatile ₹1,58,000 – ₹1,62,000 range as the market digests the appointment of Mojtaba Khamenei in Iran.

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End…

The post Gold, Silver Crash: MCX Rates Below ₹1.61 Lakh as Dollar Hits 3-Month High first appeared on Business League.