Gotrade News - Spot gold dropped 0.20% to USD 4,740.34 per troy ounce on Monday (13/04), touching its lowest level since April 7 as US-Iran peace negotiations collapsed over the weekend. A strengthening US dollar compounded the pressure, making gold more expensive for buyers holding other currencies.
Phillip Streible, market strategist at Blue Line Futures, stated that the market is heavily driven by news sentiment right now. He noted that crude oil price movements are the key variable to watch, given their direct implications for inflation and Federal Reserve policy direction.
Key Takeaways:
- Spot gold fell 0.20% to USD 4,740.34 on Monday (13/04), its lowest since April 7, on dollar strength and failed US-Iran talks
- Fed rate cut probability by year-end dropped sharply from 40% to just 21% as inflation fears resurged
- Gold recovered to USD 4,758.2 by Tuesday morning (14/04), up 0.14%, suggesting buyers re-entered after the dip
According to Liputan6, the US initiated a naval blockade of ships from Iranian ports after talks broke down without agreement. Iran subsequently threatened retaliatory action against Gulf-region ports, significantly worsening the ceasefire outlook and pushing crude oil above USD 100 per barrel.
The Federal Reserve's rate cut probability by year-end fell to 21% from a prior 40%, according to Liputan6. Higher interest rates reduce gold's relative appeal since the metal generates no yield, making rate expectations a critical driver of gold price direction.
Geopolitical Pressure vs. Safe-Haven Demand
Paul Wong, strategist at Sprott Asset Management, warned that if the Strait of Hormuz remains blocked, markets may not function normally. He stated that energy shortages and payment disruptions could elevate gold's role as a trusted cross-border asset, creating a countervailing bullish case.
Gold had gained 2.41% over three consecutive trading days before Monday's pullback, according to Bloomberg Technoz. The decline was partly attributed to profit-taking after the rally, suggesting underlying demand remains intact even as macro headwinds persist.
Silver fell 2.4% to USD 74.07 per ounce on Monday, while platinum declined 1.2% to USD 2,021.28, according to Liputan6. Palladium bucked the trend with a 0.4% gain to USD 1,527.45, indicating selective demand within the precious metals complex.
By 06:51 WIB on Tuesday (14/04), spot gold had recovered to USD 4,758.2, gaining 0.14% from the prior close. Bloomberg Technoz noted the recovery attempt signals renewed buyer interest despite the ongoing macro uncertainty.
Gold ETFs as a Portfolio Tool
For investors who want exposure to gold price movements without holding the physical metal, gold ETFs offer a practical alternative. GLD -- the SPDR Gold Shares ETF -- directly tracks spot gold prices and can be bought and sold like any stock on Gotrade.
GLDM, the SPDR Gold MiniShares Trust, offers a lower-cost entry point for investors building smaller positions in gold. For broader commodity and energy diversification alongside gold, XLE captures the energy sector that is itself moving sharply on the same geopolitical tensions.Gold ETFs allow investors to respond quickly when geopolitical news moves prices, without the logistics of physical gold storage. All of these instruments are available to trade directly on Gotrade.
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