Gold jumped more than 5% and silver nearly 5% after suffering heavy losses in the previous two trading sessions, as investors returned to the market on the back of strong underlying fundamentals and dip-buying activity.
Gold was heading for its largest intraday gain since 2008, while silver also staged a strong recovery. Market analysts said the long-term outlook for precious metals remains supportive, prompting investors to buy after the sharp correction.
Reuters reported that gold and silver prices rallied sharply on Tuesday (February 3, 2026, US time), following steep declines over the prior two sessions. The metals were on track for their biggest single-day advances since November 2008, driven by bargain-hunters who viewed the sell-off as an opportunity in a fundamentally solid market.
Spot gold climbed 5.2% to $4,906.82 per ounce by 1:31pm US Eastern time (18:31 GMT), bouncing back from Monday’s low of $4,403.24. Despite the rebound, prices remained below last week’s record peak of $5,594.82.
US gold futures for April delivery rose even more sharply, surging 6.1% to $4,935 per ounce.
Silver gained 4.8% to $83.23 per ounce on Tuesday, after tumbling a record 27% on Friday and sliding another 6% on Monday.
Peter Grant, vice-president and senior metals strategist at Zaner Metals, described the recent pullback as a correction within a broader upward trend. He noted that many of the core drivers behind gold’s multi-year rally are still in place.
Grant added that the market could now enter a consolidation phase, with technical support near $4,400 and resistance around $5,100.
The sharp sell-off earlier in the week followed news that Kevin Warsh had been chosen to succeed Jerome Powell as the next chair of the US Federal Reserve. Powell is expected to step down in May. Investors believe Warsh may favor interest-rate cuts while pursuing more aggressive balance-sheet tightening. Additional pressure came after CME Group increased margin requirements for precious-metals futures.
Bull Market Outlook Remains Intact
Despite recent turbulence, many analysts believe the longer-term bull market in gold is still intact, with the potential for new highs later this year.
Jeffrey Christian, managing partner at CPM Group, said prices are likely to resume their upward trend at a more sustainable pace, as investors remain concerned about global economic and political uncertainty.
Gold is widely regarded as a safe-haven asset and tends to benefit from lower interest-rate environments.
Other precious metals also advanced. Spot platinum rose 3.4% to $2,194.05 per ounce, while palladium edged up 0.4% to $1,727.03.
Meanwhile, the US Bureau of Labor Statistics announced that January’s key employment report would not be released this Friday due to a partial federal government shutdown.
Morning Market Update (February 4, 2026)
According to Bloomberg, gold prices were little changed at $4,944.66 per ounce as of 7:49am Singapore time. Silver slipped 0.8% to $84.48, platinum edged higher, and palladium declined. The Bloomberg Dollar Spot Index was steady after falling 0.3% in the previous session.
Gold held near $4,950 in early Asian trading after surging more than 6% the day before. Improved risk sentiment and a softer US dollar helped support prices. Even after the pullback, gold remained nearly 15% higher for the year, though still about 12% below the all-time high set on January 29. Silver was broadly stable.
Daniel Ghali, senior commodity strategist at TD Securities, said forced liquidation in precious metals appears to have subsided. He noted that last week’s extreme volatility may have driven many retail traders out of the market, reducing a previously strong source of buying.
Precious metals had soared last month on speculative flows, geopolitical tensions, and concerns about Federal Reserve independence. However, the rally stalled abruptly late last week, when silver posted its largest one-day drop on record and gold saw its steepest decline since 2013. The pullback followed warnings from analysts that prices had risen too far, too quickly.
Strong buying from Chinese funds and Western retail investors had fueled the rally, along with inflows into leveraged ETFs and heavy call-option activity. The sharp downturn that began during Asian trading on Friday extended into the start of the week.
Bank of America expects volatility in precious metals to remain elevated. Niklas Westermark, the bank’s head of commodities trading for EMEA, said gold has stronger long-term investment appeal than silver. While stretched valuations and price swings may affect position sizes, they are unlikely to dampen overall investor interest.
Several major banks continue to back a recovery in gold prices. Deutsche Bank reaffirmed its forecast this week that gold could climb to $6,000 per ounce.