Gold Prices Plummet to ₹128,000 on Diwali 2025: Is This the Perfect Time to Invest?

Gold prices have shown significant volatility, crashing to ₹128,000 per 10 grams on India’s Multi Commodity Exchange (MCX) on October 21, 2025, marking a 2% decline during the morning trading session. The December 2025 gold futures recorded a fall of ₹271 per 10 grams, representing a 0.21% decrease from the previous close. Similarly, MCX silver futures for the December 2025 contract fell by ₹327 per kilogram. This rapid decline follows a post-Diwali peak, prompting many traders to book profits.

The price drop in gold and silver is primarily attributed to profit-taking by investors, who are exiting positions after a favorable market rally associated with the Diwali festivities. Additionally, the strengthening of the US dollar, exacerbated by ongoing trade tensions between the United States and China, has negatively impacted gold prices. The broader context reveals a market increasingly favoring higher-risk assets such as equities, potentially leading to a sustained reduction in demand for traditional safe-haven commodities like gold and silver.

For traders and investors, the immediate outlook appears bearish, particularly as global gold has plummeted significantly, with spot prices dropping 6.3% to $4,082.03 per ounce. The potential resistance for gold remains within the $4,000 to $4,400 per ounce range, complicating prospects for a solid recovery in the near term. While some analysts maintain that structural bullish drivers still support long-term gold investments, the current emphasis on risk management and volatility awareness will be crucial for navigating this uncertain market phase.

Source: Market Source

(Expert Note: This report was independently prepared by the Wealthova Commodities team.)