Iran's ceasefire hopes sharply fade! Trump issues a "terrible" warning, gold prices plunge from high levels

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On Monday (April 6), spot gold prices sharply retreated from the intraday high above $4,700 per ounce, as the latest news on Iran’s situation triggered market volatility.

Gold prices briefly touched $4,706.68 per ounce during European trading hours on Monday, then continued to decline during New York session. By the close, spot gold fell 0.6% to $4,650.22 per ounce.

FXStreet analyst Christian Borjon Valencia pointed out that as hopes for a ceasefire in Iran rapidly diminish, gold prices have given back previous gains, falling from $4,700 per ounce. Rising oil prices and a strengthening dollar have put pressure on precious metals.

U.S. President Trump threatened that if an agreement is not reached by Tuesday, Tehran will “taste hell.”

Iran stated that it is seeking a lasting solution to end the war and is unwilling to yield to pressure to quickly reopen the Strait of Hormuz during a temporary ceasefire. Currently, both sides are weighing a framework aimed at ending this five-week conflict.

Trump said, “Iran can be taken down overnight.”

Valencia noted that during Monday’s North American trading session, gold prices retreated after reaching an intraday high of $4,706 per ounce; news that an agreement between the U.S. and Iran seems unlikely, along with military preparations for potential strikes, jointly pushed gold lower.

The Wall Street Journal reported that, according to multiple U.S. officials, the U.S. military is “preparing to strike energy targets inside Iran.”

U.S. President Trump stated on Monday: “Iran can be taken down overnight, and that night could be Tuesday night (April 7, Eastern Time).”

The initial deadline set by Trump was April 6, but he postponed the attack until 8 p.m. Eastern Time on April 7—provided Iran does not comply with U.S. demands, including immediately reopening the Strait of Hormuz.

Recently, Iran rejected ceasefire proposals, including efforts by Pakistan, Egypt, and Turkey to facilitate a 45-day pause in hostilities, laying the groundwork for a comprehensive resolution.

Currently, Iran, the U.S., and Israel are assessing how to end this five-week conflict. Iran has stated it seeks a durable ceasefire agreement and resists pressure to quickly reopen the Strait of Hormuz under a temporary ceasefire framework.

Focus on Federal Reserve Movements

Other investor concerns include the upcoming release of the Federal Reserve’s March policy meeting minutes on Wednesday, the U.S. Personal Consumption Expenditures (PCE) data on Thursday, and the Consumer Price Index (CPI) on Friday.

The Fed kept interest rates unchanged last month. The CME Group’s “FedWatch” tool indicates that most traders currently see no chance of rate cuts this year.

Tudor, Pickering, Holt & Co. global commodities strategist Bart Melek said, “The market’s focus may still be on war and interest rates. If the conflict persists and supply tightens, oil prices will gradually rise, increasing inflationary pressures. This will leave less room for central banks, especially the Fed, to ease policy. If energy prices continue to rise, it could reignite discussions about rate hikes, which is bearish for gold.”

Gold Technical Analysis

Valencia stated that gold is currently facing a key resistance at $4,700 per ounce and has retreated to near the 100-day simple moving average (SMA) at $4,639 per ounce. The Relative Strength Index (RSI) indicates that bullish momentum appears to be weakening; the indicator remains in the bearish zone and is approaching oversold levels.

Valencia said that if the price closes below the 100-day moving average, it will clear the way for further declines toward $4,600. If it breaks below that level, the next support zones to watch are the intraday low of $4,553 set on April 2, and then the $4,500 mark.

(Spot gold daily chart source: FXStreet)

Valencia added that, conversely, if gold rebounds and breaks above $4,700, the first resistance above would be the 20-day moving average at $4,755. If the rally continues, the next upside target is $4,800.

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