Gold spikes above $5,400 amid Middle East war as Bitcoin drops

Gold (XAU/USD) price has benefited extremely from the Middle East conflict. As the conflict in the Middle East escalates, Gold price surged 3.31% in the past 24 hours to reach a local high of about $5,422 per ounce on March 2, 2026, during the early European trading session.

Gold (XAU/USD) daily chart. Source: TradingView

As such, Gold’s market cap surged to around $37.69 trillion, since its amount of above-ground reserves is about 216,265 metric tonnes.

Why is the Gold price surging today amid the U.S. Dollar surge?

The main reason why the price of gold is surging today is due to the extreme demand recorded in China in the past few days. Although the U.S. Dollar has gained in value, as shown via 0.7% gain in DXY today, Chinese investors have flocked to the precious metals market.

Furthermore, China’s share of the U.S. Treasuries has been on a steep decline in recent years.

China’s share of U.S. Treasuries. Source: X

Earlier today, X user Bai Xiaojun reported that extreme retail demand for gold pushed the prices to a high of $5,574/oz. Furthermore, Xiaojun showed that JD.com Inc. (Hong Kong: 9618), China’s largest gold store, experienced login glitches due to extreme retail demand.

Why is Bitcoin price down for 5 consecutive months?

Amid the ongoing precious metal bull rally, the Bitcoin ($BTC) price has been trapped in a macro bear market. Following its over 15% dump in February 2026, the flagship coin has now closed five consecutive months in the red.

$BTC/USD monthly chart. Source: TradingView

Bitcoin price has been trapped in a macro bear market primarily due to the notable decline in its Open Interest (OI) amid heavy liquidation of long traders. Amid the ongoing macroeconomic uncertainty, mainly due to the Middle East crisis, Bitcoin’s OI has dropped from above $62 billion in mid January 2026 to hover about $43 billion at press time.

$BTC OI for 2026. Source: CoinGlass

Meanwhile, Bitcoin price has suffered macro bearish outlook catalyzed by low spot demand. According to market data from SoSoValue, the United States Spot Bitcoin Exchange-Traded Funds (ETFs) recorded a total net outflow of $27.55 million on Friday, February 27, 2026. Interestingly, the U.S. spot $BTC ETFs have recorded four consecutive months of outflows of about $6.4 billion.