On April 8, the overall market trend is challenging to predict, with difficulty in determining the directional bias due to uncertainty surrounding the current U.S.-Iran situation. Although both sides have temporarily ceased hostilities for negotiations, the unpredictable nature of U.S. leadership introduces significant risk. Past instances, such as the abrupt termination of a peace agreement within 24 hours of signing, demonstrate a lack of commitment to diplomatic accords. Therefore, the announced two-week ceasefire for discussions cannot be considered definitive, necessitating cautious short-term trading until the market provides further confirmation.
Another key point to note is that while gold has surged strongly back above 4800, this rally is largely driven by sharp declines in crude oil and the U.S. dollar. There is also the possibility of a squeeze after two days of market consolidation. Gold's recent resilience—refusing to decline amid strong buying interest—has attracted attention from institutional players who may be poised to liquidate long positions. Especially while the ceasefire agreement remains uncertain, gold could experience significant volatility, including a potential pullback from recent highs. Thus, short-term strategies today should remain prudent.
During the Asian session, gold opened firmly above 4700 and rallied sharply to a high of 4857 before retracing, demonstrating robust bullish momentum. For short-term positioning, a corrective pullback is anticipated initially. Until the ceasefire is fully confirmed, sustained upward momentum may lack strength. Traders can use the ceasefire uncertainty as a rationale to focus on buying on dips rather than chasing rallies at elevated levels, which could lead to positions being trapped awaiting suitable exit opportunities.
Intraday, resistance near 4850 may prompt a corrective move. Support is initially seen near 4750-4730. As long as 4700 holds, the strategy remains buying on dips while awaiting confirmation of the ceasefire. A decisive break above 4850-4900 would signal further strength, potentially targeting the 5000 level if the ceasefire is firmly established.
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