Gold Price Outlook: Record High Above $5,600 or Volatile Pullback as US–Iran Conflict Escalates

Gold could open sharply higher this week as military strikes involving the United States, Israel and Iran intensify geopolitical uncertainty across global markets.

Investors are bracing for heightened volatility when trading resumes, with bullion widely expected to attract strong safe-haven inflows. However, analysts warn that while fresh record highs are possible, a volatile phase may also unfold as markets digest the scale and duration of the conflict.

Gold to Spike on Open?

Several market participants anticipate a “knee-jerk” rally in gold and other commodities.

Edward Meir of Marex suggested gold could initially jump by as much as US$200 per ounce on the open before potentially easing later in the session. Historically, markets often react sharply to unexpected military escalations, but price action tends to stabilise once investors assess whether energy supply routes — particularly oil flows — face material disruption.

Ole Hansen, Head of Commodity Strategy at Saxo Bank, described the strikes as a worrying escalation and said he would not be surprised to see gold print a fresh record high, particularly given the strong upward momentum already seen in recent weeks.

Safe-Haven Demand Building

Tim Waterer of KCM Trade noted that gold is likely to be in higher demand than usual as markets reopen. With uncertainty surrounding the length of the conflict, the risk of broader regional involvement, and inflation concerns linked to rising oil prices, investors may prioritise capital preservation over risk exposure.

Fawad Razaqzada of City Index added that additional haven demand could see gold retest US$5,500 and potentially break above January’s record peak near US$5,600. However, he cautioned that gains beyond that level could be capped if the US dollar strengthens or if crude oil prices remain sharply elevated.

Joshua Rotbart of J. Rotbart & Co believes enhanced volatility with upward bias is the most probable scenario, with the extent of the rally depending heavily on energy market disruption and the broader geopolitical trajectory.

Digital Gold Signals Early Bullish Sentiment

Weekend trading in tokenised gold products has already reflected bullish sentiment. Hugo Pascal of InProved reported that digital gold proxies were trading at a premium ahead of the market open, signalling a clear “flight to safety.” While such premiums can sometimes exaggerate the initial price gap, they often correctly anticipate direction.

Volatility Likely as Key Data Looms

Beyond geopolitics, investors will also be watching key US economic data later in the week, including retail sales, non-farm payrolls and employment figures. Stronger-than-expected data could support the US dollar and temper gold’s rally, while weaker readings may reinforce the bullish case.

ANZ analyst Soni Kumari noted that while an initial positive reaction is likely, retracement during the session cannot be ruled out depending on how events unfold.

FirstGold Market View

Gold has already delivered extraordinary gains this year, supported by inflation concerns, central bank accumulation and currency debasement fears. The latest Middle East escalation adds another powerful catalyst.

Whether bullion surges to a fresh record above US$5,600 — or enters a sharp but temporary volatile phase — will largely depend on:

• The duration and scale of military action

• The impact on global oil supply

• Broader regional involvement

• US economic data and dollar strength

For now, gold remains firmly positioned as the safe-haven asset of choice in an increasingly unstable global landscape.