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The gold market is kicking off the new trading week on a strong note, as prices are higher by over $10 per ounce. The market has a number of bullish factors currently fueling demand and thus higher prices and the recent upside could be just the very beginning of a significant bull market.

Rising bond yields have been a primary source of angst for stock investors in recent weeks, and the rapid rise in stock market volatility could just be getting started. Although stocks saw what may be a relief rally to end last week’s trade, equities are once again under pressure on Monday as risk aversion is on the rise.

The rise in yields in and of itself may not be the biggest cause for concern, but rather the speed at which rates have climbed recently. The move higher in yields may not yet be over, either. Some have suggested that the benchmark ten-year note could hit a yield of four percent before the ascent fizzles out. Such a move is still a long ways from current yields around 3.26%. If yields continue to move higher, stocks could see more and more pressure as bonds and notes become significantly more competitive.

The rise in yields is by no means the only issue currently stirring the pot. Recent geopolitical developments between the U.S. and Saudi Arabia are also likely playing a role in increasing risk aversion. U.S. President Donald Trump has said that there would be “severe punishment” if it is determined that Saudi Arabia is responsible for the death of journalist Jamal Khashoggi. The Kingdom has stated that it would retaliate if action is taken by the U.S. and the country could look to leverage its oil production if necessary.

In fact, a recent article from marketwatch.com suggested that $400 per barrel oil should not be ruled out. If the Saudi Government decides to take retaliatory action, it could potentially rock global financial markets as a rapid and significant rise in oil prices could do significant damage to global economies.

Saudi Arabia is set to host the Future Investment Initiative, a large conference referred to as the “Davos in the desert” on October 23rd. Although U.S. Treasury Secretary Steven Mnuchin is still planning to attend, several other high-profile people have decided not to attend given recent developments.

The combination of higher rates, worries over trade and now the rift with Saudi Arabia may continue to weigh on investor sentiment and appetite for risk. Although stocks may find buyers if more downside is seen, the market could very well be in the midst of a shift from buy the dips to sell the rips. Concerns over these issues may keep stocks under pressure while fueling buying in perceived safe havens such as gold. The price of gold is now at a 10 week high, and the current geopolitical backdrop and rising risk aversion could keep prices on the move. An improving technical posture may also draw buyers into the market as recent price action could be indicative of a market bottom being reached.