​Gold price reaches $3500 and WTI price rises, but natural gas price slips again​

The remarkable gold rally of 2025

​As of April 2025, the gold price has soared to unprecedented levels, surpassing $3,500.00 per ounce - a more than 31% increase since the beginning of the year. This extraordinary surge reflects a confluence of global economic, political, and financial factors that have converged to create perfect conditions for the precious metal.

​The rally has caught many market observers by surprise, particularly following several months of relatively range-bound trading at the beginning of this year.

​Gold's traditional role as a safe-haven asset has been emphatically reaffirmed in the current environment, with investors flocking to the metal amid heightened uncertainty.

​For UK investors, the picture is equally impressive, with gold prices reaching an all-time high of £2,600.00 per ounce, representing a 23% increase over just four months. This remarkable performance has outpaced most other asset classes, including equities and bonds.

​Market participants using trading platforms have witnessed unprecedented volatility in the gold market, with daily price swings regularly exceeding $50.00 per ounce as traders and investors reposition themselves in response to rapidly evolving global conditions.

Escalating geopolitical tensions driving safe-haven demand

​The intensification of trade conflicts, particularly between the US and China, has heightened investor anxiety and contributed significantly to gold's appeal. President Donald Trump's recent tariff announcements have disrupted global markets, leading to significant declines in US equities and the dollar.

​His recent scathing comments about the US Federal Reserve (Fed) Chair Jerome Powell and the Fed “not cutting interest rates quickly enough” have alarmed investors with some beginning to question the independence of the US central bank.

​These tensions extend beyond just economic matters, with diplomatic relations deteriorating across several fronts. The resulting uncertainty has prompted many institutional investors to increase their gold allocations as a portfolio diversifier and geopolitical hedge.

​Historically, gold has performed well during periods of elevated geopolitical risk, and the current environment is proving no exception. The metal's lack of correlation with traditional financial assets makes it particularly valuable when political developments threaten market stability.

​For those interested in understanding how to navigate such uncertain environments, online trading platforms offer various tools to monitor and react to geopolitical developments that impact gold prices, including news feeds, economic calendars, and technical analysis features.

Central bank purchases transforming the gold market

​Central banks worldwide are significantly increasing their gold reserves, with China leading this strategic shift. Over the past two years, China has imported approximately 700 metric tons of gold from the UK, tripling gold's share in its foreign reserves to 8%.

​This move represents a deliberate strategy to reduce reliance on US Treasuries and safeguard national assets against potential sanctions or currency volatility. Other emerging market central banks have followed suit, collectively creating substantial underlying demand for physical gold.

​The scale of these purchases has fundamentally altered market dynamics, removing significant quantities of gold from circulation and contributing to the price surge.

​Central bank demand is particularly significant as these institutions tend to be long-term holders rather than speculative traders.

​For investors looking to participate in the gold market, commodity trading offers various avenues, including physical ownership, futures contracts, and gold-backed exchange-traded funds (ETFs), each with different risk and liquidity profiles.

Volatility in bond markets and dollar weakness

​The US Treasury market has experienced significant turbulence in recent months, with long-term bond yields surging and investor confidence waning. These developments have challenged the traditional role of government bonds as portfolio stabilisers, prompting investors to seek alternative safe havens.

​Simultaneously, the US dollar has weakened sharply, down 9% against a basket of major currencies since January. This dollar depreciation has made gold more affordable for non-dollar investors and removed a significant headwind that has historically constrained gold prices during periods of dollar strength.

​The inverse relationship between gold and real yields (nominal yields minus inflation) has held firm throughout this period. As real yields have fallen, the opportunity cost of holding non-yielding gold has decreased, enhancing its relative attractiveness.

​For traders interested in the relationship between currencies and gold, forex trading platforms provide tools to monitor these correlations and potentially capitalise on the interplay between dollar movements and precious metals prices.

Inflation concerns and monetary policy shifts

​Persistent inflation and expectations of monetary easing by the Fed have bolstered gold's appeal as an inflation hedge. Current market expectations suggest the Fed may implement multiple rate cuts in the coming months, reversing the tightening cycle of previous years.

​Investors anticipate that lower interest rates will diminish returns on fixed-income assets, making gold a more attractive alternative despite its lack of yield. Historical data supports this view, with gold typically performing well during periods of negative real interest rates.

​Recent inflation data has consistently surprised to the upside, reinforcing concerns about the erosion of purchasing power and increasing the appeal of tangible assets like gold. Even as central banks target price stability, achieving this goal has proven elusive.

​For investors seeking to protect against inflation, gold trading provides exposure to an asset with a proven track record of maintaining value during inflationary periods. Various strategies can be employed depending on an investor's risk tolerance and time horizon.

​Investment flows and market sentiment

​Investor interest in gold-backed exchange-traded funds (ETFs) has reached new heights, with holdings at their highest levels since September 2023. This surge reflects a broader shift toward safe-haven assets amid market volatility and represents a significant source of demand for gold.

​Retail investor participation has also increased markedly, with many seeking to protect against portfolio drawdowns or speculate on further price appreciation. This retail demand is evident in rising premiums for small-denomination physical gold products and increased trading volumes on retail platforms.

​Market sentiment indicators suggest that despite the substantial price increase, positioning is not yet at extreme levels that would typically signal a potential reversal. This may indicate further room for price appreciation as more investors seek exposure.

​For those considering adding gold to their portfolio, share dealing platforms offer access to gold mining companies, which can provide leveraged exposure to gold price movements, though with additional company-specific risks not present in direct gold ownership.

​Technical analysis and price projections

​From a technical perspective, gold's break above previous all-time highs around $2,500.00 per troy ounce encountered minimal resistance, suggesting a lack of significant selling pressure at these levels.

​Spot gold daily chart 

​The subsequent price action has been characterised by a series of higher highs and higher lows on intraday charts, confirming the strength of the uptrend. Short-term consolidation periods have been brief, with dips quickly met by buying interest.

​Momentum indicators remain in bullish territory despite the rapid price appreciation, though some suggest the metal may be temporarily overbought.

​The 161.8% Fibonacci extension of the January 1999-to-July 2011 advance, projected higher from the October 2015 low, at $3,755 per troy ounce represents the next technical upside target.

​Spot gold quarterly chart

​In an extended bull market scenario, the $4,000.00 mark may also be reached.

​These projections are based on continued geopolitical uncertainty, further central bank purchases, and a accommodative monetary policy environment.

​For traders employing technical strategies, spread betting on gold provides a tax-efficient way to speculate on price movements without owning the physical metal, though it's important to employ appropriate risk management techniques given the metal's volatility. 

How to trade gold in the current environment

1. ​Do your research on gold's fundamental drivers and technical patterns to inform your trading decisions. 
2. ​Choose whether you want to trade or invest in gold based on your timeframe and risk tolerance. 
3. ​Open an account with us if you don't already have one. 
4. ​Search for gold markets in our platform or app – options include spot gold, gold futures, gold mining shares, or gold ETFs. 
5. Place your trade, ensuring you have appropriate risk management strategies in place, such as stop losses, to protect against unexpected market movements. 

Gold's recent volatility presents both opportunities and risks for traders. Using a demo account can be a prudent way to practice your gold trading strategy without risking real capital while you familiarise yourself with the market's characteristics. 

​For those preferring a longer-term approach, our investment platforms allow you to build a portfolio that might include gold exposure through ETFs or mining companies, potentially providing diversification benefits during periods of market stress. 

​Remember that while gold has demonstrated strong performance recently, all trading carries risk, and past performance is not necessarily indicative of future results. A balanced approach that considers your overall investment objectives and risk tolerance is essential when adding gold exposure to your portfolio.​​