Gold holds steady after Strait of Hormuz blockade threatens oil flows

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Gold slides 0.88% to $4,708.54 today

Highlights

Escalation of US-Iran conflict and threats to the Strait of Hormuz have triggered a sharp rise in global oil prices and inflation risks.
US consumer price growth accelerated in March due to war-driven gasoline price spikes, reducing expectations for Federal Reserve rate cuts.
$4,200–$4,900 is the expected gold trading range next week, with volatility high and medium-term technicals signaling a likely sideways or bullish bias.

War-driven inflation surges as peace talks and supply routes collapse

On April 12, Washington’s announcement of a plan to blockade the Strait of Hormuz after US-Iran peace talks ended without resolution triggered a global energy-supply shock, escalating inflation risks. Continued hostilities between the US, Israel, and Iran have escalated into a full-blown war in West Asia, driving up oil prices and creating a resource-driven inflationary surge. Over the weekend preceding April 13, marathon talks in Pakistan failed to de-escalate the conflict, as disputes persisted over nuclear activities, the Strait of Hormuz, and Iranian support for militant groups. Data released on Friday showed a sharp acceleration in US consumer price growth in March, largely attributed to the war-induced surge in gasoline prices, resulting in reduced expectations for Federal Reserve interest rate cuts over the coming year.

Bearish momentum prevails as volatility spikes near session lows

Momentum signals on D1 are bearish as both MACD (-7.25) and ADX (32.49) point to ongoing selling pressure. The RSI reads 44.84 and signals Sell, while the Stoch RSI indicates Oversold conditions; CCI is Neutral. BBP remains positive and Overbought at 56.47, showing intraday buyer dominance, while the Awesome Oscillator is Neutral. The price action shows high volatility, remaining closer to the session low ($4,646.19) than the high ($4,753.76), with sellers controlling short-term moves, though the Ichimoku Kijun ($4,486.47) offers immediate support.

Upside probability increases as technicals align within volatile range

For the next week, the expected trading range is set between $4,200 and $4,900, representing a typical volatility band relative to current levels. The probability of a price increase over the next five sessions remains high (over 80%) given concurrent Buy signals from the weekly MA-50, RSI, ADX, and MACD. The baseline scenario anticipates sideways movement within this band as supply and demand equilibrate. A sharp rally above immediate resistance could see XAU approach the upper $4,900s, whereas a firm break below support could prompt a retracement toward the $4,200 – $4,400 region.

Viktoras Karapetjanc, macro and fundamental analyst at Traders Union, sees gold in a supportive range amid persistent geopolitical risks and inflationary pressures. He notes selling still dominates the short term, but long-term backing remains firm due to the ongoing conflict in West Asia and its spillover on energy markets. The analyst believes the probability of price appreciation in the coming week is high, with key signals showing potential upside within the $4,200 to $4,900 band. 'If inflationary concerns intensify and geopolitical tensions persist, I expect gold to test resistance toward the upper $4,900s within the week,' Karapetjanc says.

Earlier, analysts noted that gold was exhibiting persistent bearish momentum amid technical and macroeconomic headwinds. The current analysis introduces a significant shift, as heightened geopolitical conflict and inflationary pressures now underpin a markedly higher probability of upside, making a breakout above the weekly volatility band an important scenario to monitor.

Source of Data: XAU Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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