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At the beginning of February, the gold price a hit of more than 20 percent. A strong correction that, at first glance, could have broken sentiment. But what happened next is characteristic of a bull market: the decline turned out to be short-lived and was bought up quickly and convincingly.
New buyers stepped in, confidence remained intact and gold stabilized rapidly. That's exactly the behavior you want to see in a strong upward trend. Corrections are part of the equation, but they will not be the start of a prolonged decline; on the contrary, they will fuel the next movement.
In an era of increasing geopolitical turmoil, gold is thus once again proving its worth. Not only as a theoretical safe haven, but as an asset that actually lives up to that role when the tension rises. We are now seeing that again during the unrest in Iran.
Gold is undeniably in a long bull run that began towards the end of 2022. From that moment on, a period of heightened geopolitical turmoil began with the Ukraine conflict, which seems to be coming to an end for now.
This weekend, we saw the conflict between Iran and the United States escalate. Iranian leader Ali Khomeini was killed in U.S. and Israeli air strikes on Saturday. Iran responded by attacking Israel and several Gulf states.
For now, gold is reacting very strongly to developments in Iran. Investors currently clearly see the precious metal as the safe haven in times of geopolitical turmoil. At the time of writing, gold is trading near its record price.
If Donald Trump is to be believed, the attacks on Iran should last about four weeks. “We thought it would take about four weeks.” It's a big country, it will take four weeks, or less, Trump said in an interview with The Daily Mail.
For the arguments for investing in gold In principle, the further substantive settlement of the conflict is not relevant. Investors currently see that the market sees gold as a safe haven. This is once again confirmed by the price action we see at the beginning of the week.
This once again confirms gold's status as a safe haven in times of economic and geopolitical uncertainty. In that regard, these price movements are again good for gold's fundamental reputation as an asset.
In addition to the fact that the general geopolitical turmoil is a reason for investors to choose gold, there are also specific reasons in relation to the conflict between Iran and the United States.
The big risk of a further escalation of tensions between the US and Iran is a sharp rise in the oil price, as we see it today. Analysts valuing that the oil price could theoretically rise by 10 to 20 dollars a barrel from current levels if the conflict in this area were to escalate completely.
Indeed, Iran is an important oil producer and exporter in the Middle East. In addition, the Strait of Hormuz is a critical maritime pipeline that transports approximately 20 to 30 percent of the world's oil. We see an immediate reaction from the oil price, now that Iran has closed this important passageway.
This can become a problem. A higher oil price actually means a weaker economy. It makes economic activity more expensive. In theory, that is also an argument for gold. In this way, the conflict in Iran provides several arguments that support an investment in gold.
There is a chance that the conflict will be over relatively quickly, but even then, this episode has once again made something clear to investors: a small allocation to gold can be valuable, precisely because it often performs at times when many other investments are under pressure.
When the world's risks increase, we see a recognisable pattern. Capital is flowing out of stocks, government bonds are losing their natural appeal and gold is gaining ground. This movement is not always spectacular, but it is consistent. More and more investors are beginning to recognize that mechanism.
This gives gold's reputation as a safe haven in times of uncertainty shine again. And reputation is not an afterthought in the financial world, but a fundamental factor. Markets don't just run on numbers and cash flows, but also on trust and collective beliefs.
Because if investors lose faith that gold offers protection during geopolitical tensions, an important part of the demand disappears. And without that conviction, returns are likely to lag behind. That is precisely why it is so relevant that gold reaffirms its role every time tension rises.
After the escalation in Iran, gold is rising back to record levels and reaffirming its strength as a safe haven. Learn why investors are now opting for gold in droves and what it means for the rest of 2026.
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