Gold futures trade sharply lower as of February 2, 2026, with the April 2026 contract down about 3% after a third straight session of declines. The pullback followed an aggressive round of profit-booking after last month’s record-breaking rally. Traders reacted to a firmer US dollar and changing expectations around Federal Reserve policy, which reduced demand for non-yielding assets. Market participants continue to digest the speed and scale of the reversal. Could volatility remain elevated in the days ahead? Silver Futures Underperform After Steep Correction Silver futures posted heavier losses than gold, with prices cracking to over 6% in the latest session. On the COMEX, silver futures plunged by over 6% to trade at $73 as of writing, marking one of the sharpest single-day declines on record. The move followed a period of intense speculative inflows that pushed silver to fresh all-time highs last month. As leverage unwound, sellers dominated price action and dragged the metal lower for a third consecutive session. Profit-Taking Follows Record-Breaking Rally Gold and silver futures entered February after an extraordinary rally that lifted prices to historic peaks. Gold surged to a record near $5,544 per ounce , while silver climbed to around $121 per ounce . The latest selloff reflects a classic profit-taking phase after a crowded trade reversed. Traders locked in gains as momentum faded and liquidity thinned. The rapid shift surprised many desks and triggered sharp intraday swings across global bullion markets. Fed Leadership Uncertainty Pressures Bullion Shifting expectations around US monetary policy added pressure to precious metals. Reports that President Donald Trump nominated Kevin Warsh as the next Federal Reserve Chair reshaped rate assumptions. Markets view Warsh as a hawkish policymaker with a preference for a leaner balance sheet. This perception supported the US dollar and lifted Treasury yields, which raised the opportunity cost of holding gold and silver. Stronger-than-expected US inflation data reinforced this trend and weighed further on futures prices. CME Margin Hikes Amplify Volatility CME Group intensified the selloff after announcing higher margin requirements for precious metals futures. COMEX gold margins rose from 6% to 8%, while silver margins increased from 11% to 15%. Higher margins forced leveraged traders to post more capital or exit positions. Many participants chose to unwind, which accelerated selling and reduced liquidity. Analysts noted that margin-driven liquidations spilled into other asset classes as traders scrambled to cover losses. From the latest news, a second margin increase is effective from Monday Feb 2nd. This maintenance is likely to result in a 33% increase for gold futures and a 36% increase for silver futures. Technical Levels Come Into Focus From a technical perspective, gold futures retested key levels near December 2025 highs after filling earlier gaps. Prices hover around a critical zone near $4,600 per ounce, which traders now monitor closely. Source: Investing.com via X Sustained trading below this level could open the door to deeper declines toward $4,275, with $3,885 acting as another notable support. Silver futures also remain vulnerable after their historic plunge, although prices still show gains on a year-to-date basis. Outlook Remains Volatile Despite Long-Term Support Despite the sharp correction, gold and silver futures still hold gains for the year. Analysts continue to track Federal Reserve signals, dollar strength, and margin dynamics for near-term direction. The recent crash appears to have paused the record-setting rally, yet markets continue to watch whether stability returns or fresh volatility emerges next.
