Precious metals prices have rebounded sharply! On the afternoon of February 3rd, the prices of gold and silver experienced a significant surge. At the time of writing, spot gold had risen nearly 6%, climbing back above $4,900 per ounce, while spot silver surged over 10%, breaking through the $87 per ounce mark. On the same day, some A-share gold-related stocks saw a rebound. By the market close, Xiaocheng Technology soared over 18%, Hunan Gold Corporation Limited and Caibai Co., Ltd. hit the daily upside limit, and Zijin Mining Group Company Limited rose over 6%. Conversely, Hunan Silver and Silver Co., Ltd. continued to hit the daily downside limit. In the domestic commodity futures market, precious metals showed divergent trends. Shanghai silver futures closed down 16.71%, while palladium futures finished up 8.62%. The main Shanghai gold futures contract bottomed out and recovered, closing with a 0.63% increase. After the market closed, the Shanghai Gold Exchange issued a notice adjusting the margin requirements and daily price fluctuation limits for certain gold contracts. Effective from the clearing time after the close on February 4th, the margin ratio for contracts including Au(T+D), mAu(T+D), Au(T+N1), Au(T+N2), NYAuTN06, and NYAuTN12 will be adjusted from 16% to 17%, and the daily price fluctuation limit will be adjusted from 15% to 16% starting the next trading day. The margin for the CAu99.99 contract will be adjusted from 120,000 yuan per lot to 150,000 yuan per lot. Furthermore, adjustments were made to the margin levels and daily price limits for silver deferred settlement contracts. Effective from the clearing time after the close on February 3rd, the margin level for the Ag(T+D) contract was adjusted from 26% to 23%, and the daily price fluctuation limit will be adjusted from 25% to 22% starting the next trading day. Analysts point out that the market is still digesting recent sharp volatilities and reassessing risk appetite. In the short term, volatility in precious metals is likely to remain elevated. Following sharp declines over the previous two trading sessions, gold and silver prices staged a significant rebound today (February 3rd). At the time of writing, spot gold was up 5.90% at $4,934 per ounce, while spot silver had surged 10.50% to $87.44 per ounce. Ahmed Al-Siri, a market strategist at Pepperstone Group, stated, "The fundamental factors supporting gold currently remain largely consistent with the conditions prior to last Friday's correction. Nevertheless, as the market continues to digest the recent extreme volatility and reassess risk appetite, high volatility is likely to persist in the near term." Last Friday and this Monday, precious metals prices plummeted from historic highs that had even surprised veteran traders. Last month, an already fervent rally accelerated further, driven by investors buying gold and silver heavily due to concerns over geopolitical instability, currency depreciation, and threats to the Federal Reserve's independence. However, this trend reversed last Friday, primarily due to a rebound in the US dollar. By Monday's close, the gold price had fallen 17% from the historic high of $5,595.47 per ounce set on January 29th, while the silver price had plunged more than a third from its peak. Some institutions remain optimistic about gold's future prospects. Deutsche Bank released a research report on Monday reiterating its bullish forecast, suggesting gold prices could potentially reach $6,000 per ounce. Garfield Reynolds, Head of MLIV's Asia team, commented, "The consecutive days of sharp declines in gold represent a technical correction that was overdue. However, the fundamental drivers behind its multi-year ascent persist and are strong enough to prevent precious metals from entering a sustained downtrend. Given the difficulty of rapid global monetary policy tightening, coupled with lingering geopolitical concerns, precious metals are more likely to maintain a moderate upward trajectory." Investors are also closely monitoring the situation in Iran, after US President Trump indicated that negotiations for a new nuclear deal could commence in the coming days. A diplomatic breakthrough could potentially diminish gold's appeal as a safe-haven asset, thereby exerting downward pressure on prices. Hebe Chen, an analyst at Vantage Markets in Melbourne, said, "The preceding violent sell-off and the subsequent rapid rebound both highlight an extremely sensitive market, driven by sentiment swings triggered by breaking news rather than a clear directional trend. This implies that sharp and unsettling volatility will likely be the norm in the near term." On the afternoon of February 3rd, the Shanghai Gold Exchange issued a "Notice on Adjusting Margin Levels and Daily Price Limits for Certain Gold Contracts." In accordance with the relevant provisions of the "Shanghai Gold Exchange Risk Control Management Measures," the Exchange decided to adjust the trading margin requirements and daily price fluctuation limits for certain gold contracts. The relevant details are as follows. Effective from the clearing time after the close on Wednesday, February 4, 2026, the margin ratio for contracts including Au(T+D), mAu(T+D), Au(T+N1), Au(T+N2), NYAuTN06, and NYAuTN12 will be adjusted from 16% to 17%. The daily price fluctuation limit will be adjusted from 15% to 16% starting the next trading day. The margin for the CAu99.99 contract will be adjusted from 120,000 yuan per lot to 150,000 yuan per lot. Additionally, the Shanghai Gold Exchange issued a "Notice on Adjusting Margin Levels and Daily Price Limits for Silver Deferred Settlement Contracts." In accordance with the relevant provisions of the "Shanghai Gold Exchange Risk Control Management Measures," the Exchange decided to adjust the trading margin requirements and daily price fluctuation limits for silver deferred settlement contracts. The relevant details are as follows. Effective from the clearing time after the close on Tuesday, February 3, 2026, the margin level for the Ag(T+D) contract is adjusted from 26% to 23%. The daily price fluctuation limit will be adjusted from 25% to 22% starting the next trading day. All members are requested to enhance their risk awareness, meticulously prepare risk contingency plans, advise investors to strengthen risk prevention measures, manage positions rationally, invest prudently, and ensure the stable and healthy operation of the market.
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