Gold slips after brief surge on Iran tensions, but Metals Focus still sees upside

Gold’s initial safe-haven pop on escalating Iran conflict headlines faded quickly: the metal briefly tested resistance near $5,400/oz early week but slid back below $5,100/oz by Thursday afternoon. Metals Focus argues this pattern is typical—geopolitical risk premiums in gold often prove short-lived—yet it still sees a path higher for the rest of the year given elevated tail risks and broader uncertainty. Metals Focus highlights specific tail-risk channels that could reprice gold higher: disruption risks to global energy markets via Strait of Hormuz shipping and the possibility the war widens (noting 12 nations drawn into the conflict). In a baseline “contained conflict” scenario, they expect gold could retest January’s all-time highs but may lack momentum for sustained gains; however, any credible signal of conflict expansion or significant oil-market disruption could “easily” push gold toward $6,000/oz. Beyond event-driven volatility, the firm stays structurally bullish, arguing recent US interventions (Iran and Venezuela) and perceived unilateralism increase long-duration geopolitical uncertainty—supportive for strategic gold allocation. They also flag relative-support vs Treasuries: despite some USD inflows, US 10-year yields moved back above 4%, and Metals Focus sees limited Treasury haven demand as a positive for gold (both via haven competition and USD implications). Near-term catalysts are conflict escalation/de-escalation headlines, oil market disruption indicators, and US rates/dollar moves. Key risk to the bullish tail case is rapid investor “fatigue” and political constraints against a prolonged Middle East conflict (with US election-related sensitivities), which could cap the geopolitical premium and keep gold range-bound unless energy supply risks become material.