Gold Holds Its Breath at $4,675 as Trump's Iran Deadline Arrives

Gold entered Tuesday suspended between two equally powerful forces the threat of significant military escalation and the prospect that a resolution, if it comes, would strip the metal of its remaining war premium in hours. The result has been one of the most paralyzed sessions in months. Gold is trading in a narrow range of $4,650–$4,680, showing little volatility as traders remain cautious ahead of President Trump's deadline for Iran regarding the Strait of Hormuz.

The gold price hangs in the balance between escalating U.S. threats and references to a war exit. On Monday, President Trump took a softer tone, implying he would not seize Iran's oil — a move that would complicate and extend the war effort. Still, his Tuesday night deadline for Iran to reopen the Strait of Hormuz is quickly approaching. Trump said he would attack the country's power plants if Iran fails to comply. Iranian officials have characterized the threat as an intent to commit a war crime.

Hopes for a potential truce faded as Trump sharpened his rhetoric, reiterating the attack deadline for 8 PM Eastern Time and noting that Iran "can be taken out in one night, and that might be tomorrow night." Iran rejected the ceasefire proposal and called for a permanent end to the war. Amid the looming deadline and Trump's extensive threats, gold traders prefer to wait on the sidelines and refrain from creating fresh positions, keeping the metal in limbo.

The precious metal has swung from an all-time high of $5,500 in February to a gut-wrenching low of $4,100 just weeks ago a range fueled by a paradoxical mix of record safe-haven demand and desperate institutional selling as the conflict in the Middle East reshapes global trade.

What makes this week particularly consequential for gold is that the Iran deadline is only one of several major catalysts colliding simultaneously. High volatility in gold prices is expected this week amid the release of FOMC minutes, U.S. GDP data for Q4, the U.S. Consumer Price Index, and other macroeconomic indicators.

The Federal Reserve's posture has become gold's single greatest headwind. The US-Iran conflict has raised fears of inflation, causing some analysts to forecast no rate cuts in 2026. Futures point to virtually no chance of a move at the April 28–29 FOMC meeting and a 77.5% probability the Fed will stay on hold through year-end, according to the CME FedWatch tool.

The Fed's updated projections are modestly hawkish: growth forecasts were raised across 2026–2028, inflation projections were also revised higher most notably for 2026 while the median rates path remains unchanged through 2028. Powell's press conference stressed that persistent inflation, not weak growth, remains the main concern, highlighting sticky non-housing services, the need for more goods disinflation, and upside risks from tariffs, oil, and the Middle East.

This creates a direct conflict for gold. High oil prices above $110 per barrel raise inflation concerns, which can benefit gold over the longer term, but for now they are putting a bit of pressure on the metal by raising the prospect of the Fed cutting interest rates less aggressively than markets had hoped. Some traders have shifted toward the U.S. dollar as an alternative safe haven, contributing to profit-taking in bullion.

Gold holds a broadly bearish near-term technical bias, remaining entrenched below the 21-day simple moving average at $4,774.95 and the 50-day SMA at $4,935 keeping the recent rebound capped within a corrective context. The RSI hovers around 45, suggesting subdued buying interest. A bear cross confirmed on March 25 when the 21-day SMA closed below the 50-day SMA.

Initial resistance emerges at the 20-day EMA near $4,720, followed by the recent rebound high around $4,800, where a sustained break would open the way toward the $4,870 region. A break below $4,620 might expose deeper support around $4,580–$4,600, especially if positive developments emerge on the diplomatic front.

Beneath the surface, diplomatic signals have not entirely evaporated. Gold prices continue to recover from their March lows, supported by signs of easing tensions. Donald Trump has reportedly informed his advisers of his willingness to end the confrontation with Iran, even if navigation through the Strait of Hormuz is not fully restored. Regional sources indicate that Iranian President Masoud Pezeshkian may agree to a settlement under certain conditions. Whether those conditions and Trump's deadline can be reconciled before 8 PM Eastern tonight is the question every trader in the gold market is waiting to answer.

Whatever tonight's outcome, the longer-term architecture supporting gold remains largely intact. The events of early 2026 have fundamentally changed the market's perception of gold's role in a modern crisis. Historically, gold was the first asset investors bought during a war. In 2026, it has become the last asset they sell.

Gold has pulled back roughly 9–10% since its highs above $5,500, but is still up more than 55% over the course of the year. Long-term forecasts remain constructive, with targets toward $5,400 by year-end driven by persistent inflation risks from energy shocks, portfolio shifts away from the dollar, and gold's role as a hedge during periods of uncertainty.

Tonight's deadline is not the end of this story. It is, at most, the next chapter.

Wishing you as always good trading,