The only factor in Ukrainian non-gold market

Gold prices made a strong move on Monday, May 12th, breaking through the key psychological level of $1,300 per ounce amid rising geopolitical tensions. Despite initial volatility, the price has since held above this critical threshold, signaling resilience in the gold market.

James Steel, a precious metals analyst at a major bank, explained that the surge was driven by multiple factors. “It’s not just about Ukraine,” he said. “There are broader concerns across the eurozone, and these have all contributed to a safer-haven demand for gold.”

Meanwhile, in eastern Ukraine, the regions of Donetsk and Lugansk declared themselves independent from Kyiv following a controversial referendum. This development has further escalated regional tensions, adding fuel to the fire for gold as a safe-haven asset.

Steel also highlighted growing physical demand in Asia, particularly from countries like India and China, where gold is often seen as both an investment and a cultural staple. This increase in demand has provided additional support to the market.

A New York-based trader added that technical factors also played a role in the recent price movement. “After the opening bell, gold dipped below the long-term trend line, but it didn’t fall much further,” he noted. “Since then, the price has stabilized, and I believe there has been some short covering. When gold moved above $1,295, more buyers stepped in.”

The trader also pointed out that the market seems to be attempting a reversal after hitting its December low. “It looks like gold has been consolidating between $1,275 and $1,285, and there could be some underlying demand building up in that range.”

With global uncertainties continuing to mount, the gold market remains a key indicator of investor sentiment. As geopolitical risks persist and economic conditions remain uncertain, gold may continue to play a central role in the financial landscape.