On Tuesday, April 7, during early Asian trading hours, spot gold continued its roller-coaster movement, currently trading near $4,625. As the deadline approaches, market volatility is expected to intensify further. If U.S.-Iran tensions escalate again, safe-haven sentiment could drive gold prices above the $4,700 mark. Conversely, if the situation unexpectedly eases or if the Federal Reserve signals more aggressive interest rate hikes, gold may once again test the key support level at $4,600, possibly even falling toward previous lows. Global attention is focused on the "final moment" scheduled for Tuesday evening U.S. Eastern Time, as a decisive battle between bulls and bears in the gold market appears imminent.
The gold market is currently caught in a typical tug-of-war between bullish and bearish forces, with both sides locked in a stalemate. On one hand, geopolitical conflicts and rising inflation support prices, while on the other, safe-haven demand is counteracted by high interest rate pressures. Concerns about slowing economic growth are weighed against tightening monetary policy expectations. These opposing forces are balancing each other, keeping gold prices confined to a narrow trading range and preventing a clear directional trend from emerging.
In the short term, the outcome of the ultimatum set for Tuesday evening will be a critical variable determining market direction. If Iran makes concessions and reopens the Strait of Hormuz, oil prices are likely to decline rapidly, easing inflationary pressures and creating room for the Federal Reserve to cut interest rates—a scenario that would be favorable for gold.
However, if Iran adopts a firm stance and refuses to compromise, leading to an escalation of conflict through increased U.S. military action, short-term safe-haven buying would likely surge, pushing gold prices higher. In the medium term, however, rising inflation expectations and heightened anticipation of interest rate hikes could continue to cap gold's upward momentum. Gold is currently at an extremely rare equilibrium point where bullish and bearish forces are evenly matched, with neither side able to establish a clear advantage.
Three major events this week will directly determine whether gold can break out of its current range:
First, the release of the Federal Reserve’s March meeting minutes on Wednesday. These minutes will reveal the Fed’s true stance on war and inflation, as well as internal discussions regarding the future path of interest rates. If the minutes convey a strong anti-inflation stance, market expectations for rate hikes will rise, putting renewed pressure on gold prices.
Second, Thursday’s release of the core PCE inflation data, the Fed’s preferred inflation gauge. If the data remains elevated, expectations that high interest rates will persist for longer will be reinforced, keeping gold under sustained pressure.
Third, Friday’s CPI data release. Many institutions anticipate that the inflationary effects of the ongoing conflict will be reflected in the CPI figures. If inflation significantly exceeds expectations, gold will face dual pressure from rising rate hike expectations, significantly increasing downside risks.
On Monday, international gold markets opened as usual. Influenced by negative non-farm payroll data, prices initially dipped to $4,600 but did not continue to weaken, instead rebounding in a volatile manner to a high of $4,705. Throughout the day, prices oscillated repeatedly between $4,600 and $4,705, eventually settling around $4,650, reflecting high uncertainty and strong divergence between bulls and bears.
Therefore, the view remains consistent with yesterday’s analysis: gold has entered a clear consolidation phase. Only after key data such as the Fed minutes and CPI figures are released is a breakout likely, paving the way for a sustained directional move. The medium-term broad range continues to be seen between $4,500 and $4,800. Until this range is broken, no clear trend is expected: a break below $4,500 would target $4,350, while a break above $4,800 would open the path toward $5,000.
Based on Monday’s volatility pattern, Tuesday’s trading range is expected to narrow further. The daily chart structure remains relatively weak, suggesting a risk of further declines. Key support levels to watch are $4,600, $4,550, and $4,500. On the 4-hour chart, a very tight range is identified between $4,600 and $4,700. In terms of trading strategy, it is advised not to become overly bearish unless prices fall below $4,600, and not to become overly bullish unless prices firmly break above $4,700. Within this range, traders may consider selling near the top and buying near the bottom, engaging in short-term speculative trades to steadily accumulate profits while waiting for a clear breakout signal before committing to a directional position.
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