Key Highlights
- Precious metal climbed 0.4% to approximately $4,509 per ounce on Monday following last week’s decline to $4,000/oz
- OCBC strategists indicate the recovery appears technical in nature, identifying crucial resistance points at $4,624, $4,670, and $4,850 per ounce
- Yemen-based Houthi forces launched strikes against Israel during the weekend, intensifying concerns about regional warfare expansion
- Tehran targeted aluminum production sites in Bahrain and UAE, propelling aluminum valuations upward by 5.4%
- Elevated energy costs and greenback strength continue to weigh on the yellow metal, which has declined 13% during the current month
The precious metal market showed signs of recovery during Monday’s Asian trading session, with gold advancing 0.4% to settle at $4,509.51 per ounce. Gold futures contracts similarly increased by 0.4%, touching $4,537.40 per ounce.
This uptick follows a volatile trading period during which spot gold plummeted to approximately $4,000 per ounce before staging a recovery toward $4,500 by the week’s conclusion.
Strategists at ANZ noted that bargain-hunting investors entered the market following what they characterized as one of the most significant precious metal sell-offs in recent memory. Outflows from gold-backed exchange-traded funds had driven valuations down over 15% throughout the month.
The yellow metal continues to show monthly losses exceeding 13%. An appreciating U.S. dollar combined with rising petroleum prices has constrained any meaningful recovery momentum.
Brent crude prices soared past $115 per barrel following Yemen’s Houthi movement’s entry into the conflict, with the group taking credit for missile attacks targeting Israel during the weekend.
Analysts from OCBC characterized gold’s bounce from recent lows as predominantly technical. They observed that the relative strength index had emerged from oversold conditions, though cautioned this alone doesn’t guarantee a durable upward trend.
The firm pinpointed critical resistance thresholds for spot gold at $4,624, $4,670, and $4,850 per ounce. Inability to maintain levels above these benchmarks could result in continued weakness, according to their assessment.
Rising energy costs present an additional challenge. OCBC strategists suggested they could sustain elevated inflation levels, potentially driving Treasury yields upward and establishing a more difficult backdrop for precious metals.
Tehran Conflict and Growing Regional Instability
The U.S.-Israel military campaign against Iran transitioned into a new stage over the weekend. The Houthi organization, which receives Iranian support and operates from Yemen, executed attacks on Israel, amplifying concerns about broader regional warfare and possible interruptions to Red Sea maritime routes.
Iranian officials stated their readiness for a potential ground offensive by American forces, following intelligence suggesting Washington was deploying thousands of military personnel to the area.
President Trump informed journalists that diplomatic discussions with Iran were progressing favorably and that an agreement might be imminent. He provided no specific timeframe while simultaneously cautioning about additional strikes against Tehran.
Trump had postponed a deadline concerning attacks on Iranian energy infrastructure until early April.
Aluminum Sector Disrupted by Iranian Military Operations
Iran executed strikes against aluminum manufacturing facilities in Bahrain and the United Arab Emirates over the weekend. Three-month aluminum futures traded on the London Metal Exchange surged 5.4% to reach $3,461 per metric ton and have advanced more than 10% throughout the month.
Aluminium Bahrain acknowledged that its facilities were struck and indicated it was evaluating the extent of the damage.
Emirates Global Aluminium reported that its Al Taweelah facility in Abu Dhabi experienced substantial damage resulting from Iranian drone and missile attacks.
ANZ strategists cautioned that approximately 4 to 5 million tons of regional aluminum shipments remain vulnerable, with no alternative sources available to compensate for potential shortfalls.
Silver declined 0.9% to $69.09 per ounce, while platinum advanced 1.8% to $1,898.73 per ounce during Monday’s session.
