Gold offsets morning losses amid failed US-Iran negotiations

Gold opened the April 13 trading session with a sharp downward gap, sliding to $4,650 per ounce. However, the precious metal managed to offset these losses as quickly as they appeared. Bullion prices are now hovering near $4,714. The primary catalyst behind the sudden drop was the breakdown of peace talks between the United States and Iran, when the two sides failed to reach an agreement on key issues. In response, Washington announced a naval blockade of Iranian ports, further escalating geopolitical tensions.

This shift in focus has turned market attention away from ongoing jitters to inflation risks. Oil costs have recently surged. So, it’s only a matter of time before consumer prices follow suit, prompting global central banks to resume monetary tightening. This scenario would pose strong headwinds for gold, as the non-yielding metal tends to lose its luster when interest rates climb.

Nevertheless, bullion is unlikely to fall far. Since the early signs of the Middle East crisis, the metal has lost over 11%, suggesting that the market has already priced in most of the negative response. The $4,650 level has acted as solid support twice, confirming its significance. Another tailwind for gold is robust physical demand. India and China remain the most devoted buyers of the asset, albeit for different reasons. The former is approaching Akshaya Tritiya—a major national holiday expected to boost sales. The latter continues to add to its central bank’s bullion reserves.

From a technical standpoint, on April 13, gold is staging a bullish recovery, closing the morning's downward gap. This shows active buyer interest during the decline. The Chaikin Oscillator confirms the momentum by halting its drop and staying in positive territory—a sign of accumulation. As for the Average Directional Index (ADX), its +DI line has bounced off recent lows and looks poised to cross above the -DI one. Such behavior often predicts an upward move. However, the picture remains murky, as the ADX itself is still below the trend strength threshold, indicating a lack of clear direction and fragile momentum.

Take into account the following trading strategy:

Buy gold near $4,700 per ounce, with Take profit at $4,870 and Stop loss at $4,600.

The forecast is valid from April 13 till April 20, 2026.