In the early morning of the 14th local time, Iran's Islamic Revolutionary Guard Corps used ballistic missiles and drones to launch military strikes on Israeli territory as retaliation for Israel's earlier bombing of the Iranian embassy. According to reports, IDF spokesman Daniel Hagari said in the early morning of the 14th that Iran launched about 200 missiles and drones into Israel, most of which were intercepted outside Israel and a few fell into Israel. An Israeli base in southern Israel suffered minor losses in the attack. In addition, an Israeli civilian was injured.
As the powder keg continues to ignite in the Middle East and geopolitical tensions rise again, all parties around the world are paying close attention to the latest developments of the incident. For investors, although the attack happened over the weekend and the financial markets were closed, it is estimated that nervous nerves have begun to taper in anticipation of Monday's opening time. Because of the outbreak of almost every major conflict event, it is inevitable that global financial markets will be plunged into violent turmoil.
This can be seen in the trend of digital currencies that are traded around the clock. After 3 a.m. on the 14th, affected by Iran's large-scale attack on Israel, the price of Bitcoin staged a high dive, once falling more than $7,000, from $67,181 to below $60,000, the largest decline since March 2023, and the decline narrowed as of press time, trading near $64,500, while Ethereum once fell from $3,200 to below $2,800, and rose to $3,074 as of press time, and other digital currencies also recorded similar trends. According to CoinGlass data, within 24 hours, more than 250,000 people in the virtual currency market were liquidated, with a total liquidation of $957 million.
圖表來源CoinGlass
Is gold going up again?
In terms of past risk events, the occurrence of war and conflict often causes funds to rush to safe havens, gold and crude oil tend to benefit, and the world's major stock markets will fall sharply under pressure. Recently, it is precisely because of the persistence of geopolitical tensions that Iran has threatened to retaliate against Israel, and gold and crude oil have exploded completely.
First of all, gold, since mid-February this year, the trend of gold has been climbing has stunned many analysts, and the spot gold price briefly broke through the $2,430 per ounce mark on Friday, and then dived from its highs under the catalyst of bullish profit-taking, with intraday fluctuations of more than $90. Despite this, gold prices remain at highs that many investors have considered unattainable in the past, with spot gold closing near $2,343 an ounce on Friday and a year-to-date gain of nearly 14%.
As a traditional safe-haven asset, gold has been chased by funds recently, in addition to the continued tensions in the Middle East, many central banks to increase their holdings of gold, the Federal Reserve is expected to cut interest rates and other factors, a large part of the factor is caused by speculation, which may be the reason why many analysts lament that they cannot understand the recent gold rally. Under the drumming and passing flowers, the crazy capital speculation has been wave after wave, pushing gold up to the sky. Among them, a mysterious force from the East - "Chinese Aunt" is undoubtedly an important driving force. Now that Iran has fulfilled its "promise" to retaliate against Israel, what will happen to the price of gold after the market opens tomorrow? I am afraid that investors will have to fall into a fierce "fight" again. As for how the price of gold will evolve, it will ultimately depend on how the Israeli-Iran conflict will happen, but sharp fluctuations are inevitable.
Gold futures daily K chart (screenshot of Futubull APP)
Crude oil is expected to gain lift
As for crude oil prices, it goes without saying that tensions in the Middle East are one of the important forces influencing the price trend of crude oil. When the war burns in the oil-rich Middle East, investors will believe that this will shape the global crude oil supply pattern, causing crude oil prices to continue to climb. Catalyzed by geopolitical tensions, oil prices have jumped to their highest level since October last year. On Friday, the West Texas Intermediate (WTI) crude oil contract for May delivery on the New York Mercantile Exchange hit an intraday high of $87.67, while Brent crude futures for June delivery rose to $92.18. Remember, the Russia-Ukraine war that broke out in February 2022 once pushed the price of crude oil to the $130 per barrel mark, which directly led to high global inflation. Now that the Israeli-Iraq conflict has broken out, where will crude oil prices ultimately go? Undoubtedly, it will ultimately depend on whether the war will escalate, but in the short term, many analysts believe that oil prices will at least move up another ladder.
Will the war heat up?
As far as safe-haven intellectual property is concerned, in addition to gold, the king of safe-haven assets, US bonds, the US dollar and the Japanese yen are also traditional important options. Recently, strong economic data released in the United States and a hot job market have greatly cooled the market's expectations for the Federal Reserve's interest rate cuts, the dollar index has gained strong momentum, and the US Treasury yields have regained momentum. On Friday, the dollar index, which measures the greenback against a basket of six major currencies, rose 0.72% on the day to close at 106.038 at the end of the session. The Israeli-Iran conflict could add momentum to the recent rise in the US dollar, putting pressure on most other currencies around the world. However, the yen may be excepted, firstly, the yen is also a safe haven for funds, and secondly, senior Japanese officials continue to verbally shout to the market, saying that if the yen continues to depreciate, they will intervene, and many analysts believe that these two factors may make the yen fall against the dollar limited, or even rebound from the low.
Reuters photo
The Israeli-Iran conflict, which has attracted much attention around the world, has already occurred, but fortunately, the global financial markets have about a day to digest the relevant information. Often, global stock markets fear the outbreak of a major war, such as the last round of Russia-Ukraine conflict, which caused global stock markets to fall sharply. As far as US stocks are concerned, the US stock market has fallen quite a bit from a record high against the backdrop of cooling expectations of interest rate cuts, and if the war escalates, the US stock market may usher in another heavy blow, which will lead to a pullback in the world's major stock markets, and investors need to be psychologically prepared for this.
As of press time, nearly 12 hours have passed since Iran launched a large-scale military operation against Israel, and judging by various sources, the Iranian side says that Iran's military operation has ended, but the armed forces are on alert. If Israel moves to attack Iranian interests in Syria, Iran will retaliate. Israel has entered a state of war, and many Western countries such as Europe and the United States have issued expressions of solidarity with Israel, but the United States does not seem to want Israel to retaliate and escalate the situation, and Biden and his senior advisers are highly worried that Israel's counterattack may lead to a regional war with disastrous consequences. So, will Israel retaliate with a tooth for a tooth or an eye for an eye? Investors might as well wait and see. (Reporter Zhu Huihao)
Top image: Reuters Images