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Gold prices edged higher in Asian trading on Monday, following a turbulent week marked by sharp swings as investors remained focused on the evolving conflict in the Middle East. Despite the modest rebound, uncertainty surrounding the outlook for the U.S.-Israel war on Iran continues to shape sentiment in bullion markets.
Spot gold rose 0.4% to $4,509.51 per ounce as of 23:36 ET (03:36 GMT), while gold futures gained 0.4% to $4,537.40 per ounce. The recovery comes after a steep decline last week, when spot prices briefly dropped to around $4,000 per ounce before rebounding toward the $4,500 level by Friday.
Other precious metals showed mixed performance. Silver declined 0.9% to $69.0915 per ounce, while platinum advanced 1.8% to $1,898.73 per ounce.
Technical rebound faces macro headwinds
Analysts at OCBC noted that gold’s rebound appears largely technical in nature, following a sharp correction of nearly 20% from levels seen at the start of the conflict. Indicators such as the Relative Strength Index have recovered from oversold territory, suggesting that bearish momentum may be easing in the short term.
However, analysts cautioned that the sustainability of the recovery remains uncertain. Key resistance levels for spot gold are seen at $4,624, $4,670, and $4,850 per ounce, which could limit further upside unless supported by stronger fundamental drivers.
Macro conditions continue to pose challenges for gold. Elevated energy prices risk sustaining inflationary pressures, which in turn could push Treasury yields higher. Rising yields typically weigh on non-yielding assets such as gold, creating a more difficult environment for sustained gains.
Geopolitical tensions remain a key driver
Markets remain on edge amid the risk of further escalation in the Middle East. Over the weekend, Yemen’s Iran-backed Houthi group launched attacks on Israel, raising concerns about the opening of a new front in the conflict. The group’s ability to target shipping routes in the Red Sea adds another layer of risk to global trade and energy flows.
At the same time, Iran signaled readiness for a potential U.S. ground invasion, following reports of increased American troop deployments in the region. These developments underscore the fragile and unpredictable nature of the conflict.
U.S. President Donald Trump stated that negotiations with Iran were progressing and that a deal could be near, although no clear timeline was provided. He also warned that further military action remains possible if talks fail.
Trump had previously extended a deadline for potential strikes on Iran’s energy infrastructure to early April, offering a window for diplomatic efforts. However, Iran has largely rejected the prospect of direct negotiations with Washington, maintaining a cautious stance.
Overall, gold markets remain caught between technical recovery signals and broader macroeconomic and geopolitical headwinds, with investors closely monitoring developments for clearer direction in the near term.
