Gold in search of a new impulse

XAU/USD

Key zone: 5,200.00-5,400.00

Buy: 5,450.00(after retesting the 5.350 level); target 5,700.00; StopLoss 5,380.00

Sell: 5,150.00(on strong negative fundamentals); target 4,900-4,850; StopLoss 5,220.00

The start of the week for gold proved explosive: quotes sharply jumped to the level of $5419, confirming its status as a classic safe-haven asset in moments of geopolitical turbulence. However, just a few hours later an equally rapid pullback followed — and it was precisely this dynamic that became the key signal for the market.

The military escalation in the Middle East overlapped with already existing logistical imbalances. As early as last year, U.S. tariffs triggered a redistribution of metal flows and the accumulation of significant inventories within the United States. Now the system is once again under stress.

Let us recall:

Despite its reputation as a “safe haven,” gold under modern conditions often becomes an instrument of aggressive speculative strategies. The primary reaction to news is mass buying using borrowed capital. This is followed by profit-taking or a chain of margin calls, which amplifies the amplitude of movement.

The current correction, in our view, does not look like a panic sell-off. Rather, it is a gradual reduction of the geopolitical premium: the market has already priced in the worst-case scenarios, but has not yet received confirmation of a long-term systemic crisis.

An additional risk factor is logistics. Dubai plays a critical role in the global precious metals supply chain, connecting Africa and Europe with Asian markets, primarily India. More than one fifth of global gold turnover passes through this hub.

After the start of military actions by the U.S. and Israel against Iran, commercial air traffic in the Persian Gulf region was disrupted. Although certain flights from Dubai were carried out, gold transportation has not resumed — priority was given to perishable cargo.

If disruptions persist, the Asian market may face a local shortage of physical metal, which will lead to rising premiums and increased intraday volatility.

Signals have already appeared: the Indian market has shifted from a discount of about $50 per ounce to levels close to London quotations.

A separate problem is “suspended” deliveries. Part of the batches intended for shipment via Heathrow Airport in London ended up in the status of unfinished export: the metals cleared customs but require repeated logistical processing.

It is noteworthy that silver is reacting more moderately so far. Its supplies depend to a greater extent on the London route; therefore, disruptions in the Persian Gulf have not affected prices as explicitly.

Incidentally, Dubai’s role in global gold trade has long generated debate. A report by SwissAid indicates that in 2022, gold worth tens of billions of dollars may have been illegally imported through the UAE.

History shows: the geopolitical factor accelerates gold quickly, but not for long. If the conflict does not destroy global logistics and does not trigger a sustained oil shock, large capital is not in a hurry to park for long in an asset without coupon yield.

However, in the event of a prolonged crisis, the situation will change. In that case, it will no longer be about short-term speculation, but about the formation of a new structural upward trend.

That is precisely why institutional investors today assess not the fact of the military conflict itself, but its duration. It is this parameter that determines whether gold will become a temporary shelter or a core element of strategic portfolios.

So we act wisely and avoid unnecessary risks.

Profits to y’all!