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Ceasefire Hopes Shattered, Gold Sees Panic-Like Selloff from Highs Summary
Summary:
Ceasefire expectations have collapsed, triggering another wave of liquidation in precious metals at elevated levels.
Sell
TradingXAUUSD
EXP
4661.12
Entry Price
4375.00
TP
4890.00
SL
4675.97 -81.83 -1.72%
0
Point
Flat
4375.00
TP
CLOSING
4661.12
Entry Price
4890.00
SL
Fundamentals
On Thursday, Donald Trump delivered a rare prime-time address from the White House, attempting to calm financial market volatility and declining political support amid the ongoing conflict. He initially stated that the war with Iran was “close to an end,” briefly fueling expectations of de-escalation.
However, the turning point came when Trump later suggested that military operations could escalate in the coming weeks, effectively dismantling the narrative of a near-term ceasefire and triggering a sharp reversal in market sentiment.
The speech resembled a renewed mobilization effort rather than a mid-conflict assessment. The war has now entered its fifth week, with rising complexity and increasing risks of losing control. Meanwhile, the Strait of Hormuz remains effectively constrained, disrupting roughly 20% of global seaborne oil supply and acting as the primary economic pressure point.
Although the White House continues to argue that energy pressures will ease after the conflict, there is still no clear roadmap for restoring navigation through the strait. This policy vacuum has significantly increased the market’s uncertainty premium.
Against this backdrop, the market narrative has shifted decisively:
Prolonged conflict → Rising oil prices
Higher inflation expectations → Reduced rate-cut expectations
Repricing of interest rate path → Pressure on precious metals
Data shows that following Trump’s remarks, market expectations for Federal Reserve rate cuts this year dropped sharply from around 25% to just 12%. This rapid repricing of rates became the direct catalyst for gold’s decline.
In terms of price action, gold experienced a “liquidation-style” selloff in the afternoon session, falling over $150 intraday and breaking key psychological levels. This suggests a crowded long positioning unwind.
Additionally, with the Easter long weekend approaching, profit-taking activity further amplified the downside move.
Importantly, this decline is not driven by a typical “risk-on” environment. Instead, it is dominated by the chain reaction of rising inflation → higher rates → increasing real rate expectations, which is structurally bearish for gold.
From a medium-term perspective, market focus is gradually shifting away from pure monetary policy expectations toward a broader macro framework (growth, inflation, and liquidity). Within this context, while gold faces short-term pressure, its role as a hedge against systemic risk remains intact.
Technical Analysis
From a structural standpoint, gold previously broke above the $4,600 level, corresponding to the 38.2% Fibonacci retracement of the decline from $5,420 to $4,098. This indicated that the move was more than a simple rebound, suggesting a potential trend-repair phase.
However, issues emerged near the $4,800 region (aligned with the 55-day moving average):
Upward momentum weakened significantly
Long positioning became increasingly crowded
Failure to achieve a sustained breakout triggered concentrated profit-taking
As a result, the rally exhibited signs of overextension and lacked sustainability.
With both momentum and structure turning bearish, the path of least resistance has shifted to the downside. Even if technical rebounds occur, they are likely to face persistent selling pressure.
Trading Strategy
Direction: Sell
Entry: 4720
Target: 4375
Stop Loss: 4890
Valid Until: May 1, 2026, 23:55
Support Levels: 4592, 4553, 4531
Resistance Levels: 4667, 4723, 4743
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