In a research report published on Saturday, Jens Nordvig, Nomura's global head of G10 FX strategy, assigned a 29 percent probability of a default in Ukraine within one year. The country's hryvnia has plunged almost 8 percent against the dollar this year.
(Read more: Gold logs third straight weekly gain)
Markets must now focus on possible contagion risk to European markets exposed to Ukraine, said David Kotok, chief investment officer at U.S. money managers Cumberland Advisors, with $2.3 billion in assets under management. "Investment implications for Central and Eastern Europe are at stake" as events continue to unfold, Kotok said. "The entire complex structural relationship between old Europe and Russia is again in play."
The fast-evolving landscape in Ukraine echoes political strains elsewhere in the emerging world, namely Venezuela and Argentina—tail-risks that may help boost the case for gold.
"With the growing international concern over the situation in Ukraine, there could be some additional movement into gold in anticipation of continued flare-ups and unrest," said Scott Carter, chief executive officer of Los Angeles-based Lear Capital.
Adding to gold's appeal are fears that U.S. data releases this week may miss expectations as the recent extreme winter weather stalls economic activity. "Economic fundamentals are weaker in the U.S. than many realize," said Miguel Perez-Santalla, vice president at online precious metals market BullionVault.
Asian demand 'sponge'
Further evidence of a deepening contraction in China's economy may provide another boost.
A key indicator of Chinese manufacturing, which dropped to a seven-month low last week, "along with unexpected weakness in the U.S. housing market, and the unstable situation in Ukraine have put the luster back on gold's safe-haven status for many investors," said Edmund Moy, chief strategist at Morgan Gold and a former director of the U.S. Mint.
(Read more: Ukraine's new rulers dismantle power structure)
Almost two-thirds of 16 people polled in a CNBC survey, 63 percent, said gold will gain this week. A quarter maintained gold will correct lower, while 12 percent said prices will be unchanged. The survey results correspond with data from IG Markets, which shows 71 percent of its more than 501 clients with open positions expect gold prices to rise.