As the US-Iran War reaches its 89th day, President Trump’s efforts to resolve the conflict have become increasingly complex, despite his stated desire to end US involvement.
If Donald Trump’s search for a way out of the Iran war was not difficult enough, he’s added a new goal that threatens to vastly complicate the Middle East’s already splintered politics.
As I have already discussed this issue in my previous gold-and-oil-peace-deal-hopes-continue-driving-market-direction-200680893″>analysis on May 5, 2026 as how the U.S. President was very near to resolve this deal on last Friday but the whole scenario took a U-turn on Monday when President Trump insists that several countries in the Middle East “immediately sign the Abraham Accords” if a peace deal with Iran is achieved, referring to a list of agreements established between Israel and a number of Arab nations during Trump’s first term in 2020.
Trump held a phone call last weekend with leaders from these countries, including the United Arab Emirates, Qatar, Pakistan, Turkey, Egypt, and Jordan. Saudi Arabia and Bahrain, which also participated in the call with Trump, have already signed the Abraham Accords.
This suggestion created yet another storm of confusion as US and Iranian negotiators haggled over the language of a proposed memorandum of understanding that might eventually provide a framework for peace talks.
But it’s hard to believe that political conditions in these states, further inflamed by Israel’s role in the Iran war, will allow even strong Arab and Muslim state leaders to offer concessions to Israel that Trump wants.
I find that it is unthinkable that the Islamic Republic would recognize its sworn enemy, Israel, any time soon, let alone considering its raids killed Supreme Leader Ali Khamenei. And there’s no chance Israel would contemplate such a step with an enemy it regards as an existential threat to the Jewish people.
And, there must be questions about Trump’s capacity to persuade allies to fall into line after starting a war that has shattered regional stability and caused serious economic damage.
So what to make of Trump’s new gambit, which followed weekend virtual talks with Arab and Muslim leaders about his Iran peace effort?
One explanation is that, despite the disappointment of an inconclusive war that has battered his approval ratings at home; he’s not given up his grand visions for a Middle East transformation. A period of reconciliation and a broadening of economic, political, and cultural links are vital to any hopes of draining the historic poison that makes each war a precursor to the next.
But it’s also clear this is hardly the moment. Any genuine belief otherwise on Trump’s part would provoke serious doubts about his grip on current realities in the region. And this would not be new: It has been a consistent problem that led him to underestimate Iran as a military adversary and apparently to assume its regime would quickly fall.
But Tehran remains unbowed. The commander of Iran’s Islamic Revolutionary Guard Corps (IRGC) of Greater Tehran, for instance, now claims his country is stronger now than it was on the first day of the war, according to the semi-official Fars News Agency.
There could be some political art at work. One possibility is that Trump may have hoped to offer incentives to Israelis — in the form of meaningful security benefits — to accept a deal with Iran that is likely to be unpopular in the Jewish state.
However, Trump’s critics may conclude that he’s looking to fill the ether with another social media post, either to distract from the torturous pace of talks with Iran or to portray himself as striving for another famous victory after a war that frustrated his expectations of a quick and overwhelming win.
Undoubtedly, such circumstances, signaling a surge in indecisiveness over the peace deal between the U.S. and Iran, have exacerbated fears of stagflation among global central banks as they seek to control inflationary pressure and find it necessary to raise interest rates.
The European Central Bank should raise interest rates in June even if the ongoing U.S.-Iran peace talks produce a deal, ECB board member Isabel Schnabel said, warning that prolonged energy price shocks are already feeding through to the broader economy and that waiting is no longer viable.
On the other hand, the Federal Reserve should move closer to raising interest rates at its upcoming meeting on June 16-17, as rising consumer prices become the dominant threat to the economy.
I anticipate that even if the conflict ended immediately, significant damage had already been done to energy infrastructure and global supply chains, making a monetary policy reaction necessary regardless.
On evaluating the movements of the gold futures on different time chart patterns, I find that the gold futures have been trying to defend the significant support at $4,513.73 since May 15, 2026, as the markets parsed mixed signals on the Iran war.
Technical Levels to Watch
In a daily chart, gold futures, after starting the day at $4,552.72, tested the day’s high at $4,558.59, and day’s low at $4,523.40, are trading near the day’s low, signaling a breakdown below the immediate support at $4,513.73 could push the futures to test the next support at $4,483.60, where a breakdown could push the futures to test the next support at $4,455 in today’s session as the gold futures are currently trading below the 9 EMA ($4,574.71), which has already come below the 100 EMA ($4,39.80), along with the 20 EMA ($4,617).
Undoubtedly, these moving averages have formed a “Bearish Crossover” which is likely to keep the bearish pressure intact this week.
I find that if gold futures break down below the significant support at $4,455 this week, a selling spree could accelerate any time this week, and could push gold futures to test the next support at the 200 EMA ($4,289).
Disclaimer: Readers are advised to take any position in gold at their own risk, as this analysis is solely based on observations.
