Gold: “You need strong nerves”

Traders need to be particularly resilient these days. Especially at the start of this week, volatility in the financial markets reached unprecedented levels. The focus remains on the geopolitical developments that are keeping the world on edge.

Investors Reduce Risk: Weekend Strategy Fuels Nervousness

March 27, 2026. FRANKFURT (Xetra-Gold). Currently, investors tend to scale back their positions slightly on Fridays, as one never knows what news might emerge over the weekend. Last Friday demonstrated that this can make perfect sense: After the market closed, U.S. President Trump initially stated that the U.S. was expected to achieve its goals in the Middle East conflict in the near future, which caused a sharp drop in oil prices on the futures markets that were still open. Shortly thereafter, however, Trump issued an ultimatum to Iran to open the Strait of Hormuz within 48 hours, threatening strikes against Iran’s energy infrastructure if it failed to do so.

Massive market reactions: Oil prices rise by double digits, yields climb

This led to a sharp rise in oil prices of more than 10 percent on Monday morning, a massive surge in government bond yields (10-year German government bonds traded at their highest level in 15 years, while 2-year U.S. Treasury yields rose above the 4.00 percent mark), and a robust pricing in of interest rate hikes by the central banks of major industrialized nations. Shortly after trading began in London, this triggered a “sell-off” in the precious metals markets, sending gold to its lowest level since the start of the year.

Signs of de-escalation ease market turbulence: Gold price recovers

After U.S. President Trump extended the ultimatum to five days in a social media post at noon our time and simultaneously mentioned talks between the U.S. and Iranian negotiators, financial markets calmed down somewhat and the gold price recovered—driven by falling oil prices and yields. As you can see, the situation remains uncertain; the potential for sudden sharp price movements due to changing news developments is likely to persist for some time.

Rumors of central bank gold sales weigh on the precious metal

Incidentally, news has been popping up on the ticker recently that some central banks are considering selling gold to generate liquidity in U.S. dollars from the proceeds. Countries mentioned include Poland (rather unlikely, as Poland’s central bank had announced just at the beginning of the year that it would increase its gold reserves) and Turkey (rather likely, as the central bank has actively traded its gold holdings in the past).

Gold Prices Plunge and Rebound: Extreme Volatility Within a Few Days

This, of course, further weighed on sentiment for gold prices: While they stood at $4,820 per ounce on Thursday morning of last week, they fell to exactly $4,500 by the end of the week. On Monday morning, the aforementioned heavy selling pressure set in, which only came to an end at $4,100. Following Trump’s social media post at noon, prices rebounded back to $4,500 and briefly dipped above the $4,600 mark yesterday. As of this writing on Thursday morning, gold is trading at $4,440 per ounce.

Xetra Gold Under Significant Pressure: Sharp Losses and Rapid Rebound

The Xetra Gold price also did not emerge entirely unscathed from these events: During regular trading hours, it fell from just under €133.00 per gram at the market open last Thursday morning to around €127.50 by the end of the week. On Monday, it plummeted rapidly to 117.20 before the yellow metal rebounded to 125 in the afternoon. Yesterday, it peaked at 127.05, slightly higher. This morning, it started the trading day around 8:00 a.m. at approximately €123.50 per gram.

Oil prices and geopolitics continue to drive market movements

At the moment, news developments regarding the situation in the Middle East are primarily driving oil prices, which in turn are influencing virtually every other price movement—including gold prices. Next week, attention will also focus on the end of the quarter and U.S. labor market data.

I wish all readers a relaxing and restful weekend.