A review of futures on the daily chart indicates that prices remain at a critical juncture. Geopolitical tensions between the United States and Iran, heightened by persistent threats from President Donald Trump over the weekend, have maintained market focus. President Trump’s latest ultimatum requires Iran to restore shipping through the Strait of Hormuz by 8 p.m. Eastern Time on Tuesday, or face severe consequences.
Trump sharpened his warning over the weekend in a Truth Social post, saying “Tuesday will be Power Plant Day, and Bridge Day, all wrapped up in one, in Iran,” signaling that Iranian civilian infrastructure could become a target if tanker traffic through the strategic waterway is not restored.
However, an Axios report on late Sunday stated that the US, Iran, and regional mediators were discussing terms for a potential 45-day ceasefire that could eventually lead to a broader agreement to end the war.
On Monday, opened lower at $4,638.51 and tested a high of $4,704.10. The low reached $4,626.50, and the price is now at $4,682. This is just below immediate resistance at the 20 EMA ($4,744) while trying to hold immediate support at the 100 EMA ($4,623.80).
On the other hand, oil prices rose in Asian hours on Monday, extending sharp gains from the previous trading sessions, as investors focused on President Donald Trump’s deadline for Iran to reopen the Strait of Hormuz.
Brent Oil Futures expiring in June rose 1.7% to $110.77 per barrel, after surging nearly 8% on Thursday, while WTI crude oil futures were largely unchanged at $111.95/barrel after advancing more than 11% in the last full trading session before the Good Friday holiday.
Meanwhile, the Organization of the Petroleum Exporting Countries and allies (OPEC+) agreed that eight member countries would raise output by 206,000 barrels per day for May.
However, traders viewed the increase as largely theoretical because much of the additional crude may not immediately reach the market under current logistical constraints.
Undoubtedly, the renewed strength in crude prices has also reinforced inflation concerns for precious metals like gold and , as the are trading near $100 levels, indicating the continuation of bullish momentum, which could keep gold and silver under bearish pressure.
I conclude that if the grim situation eases or diplomatic options are postponed for another 45 days, it could push the gold futures below the key levels in that case too, as this will weaken the fear, elevated after President Trump’s ultimatum up to 8:00 pm on Tuesday.
Undoubtedly, gold futures may take a decisive directional move this Tuesday, and this could extend exhaustion despite elevated indecisiveness, as the spot is at 64.41, indicating a potential breakout above the significant level at 66.33 this week, and that could extend the bearish pressure in gold futures.
Disclaimer: Readers are advised to take any position in gold at their own risk, as this analysis is based only on observations.
