Gold traded near $5,095 in early Asian dealing on Monday. It rose as tariff-related uncertainty increased demand for safe-haven assets.<\/p>\n
On Friday, the US Supreme Court ruled Donald Trump\u2019s tariffs illegal. Soon after, Trump used Section 122 of the Trade Act of 1974 to set a 10% global import tariff, then raised it to 15%.<\/p>\n
He also said national security tariffs under Section 232 and existing Section 301 tariffs remain in force. Ongoing trade risks have supported gold prices.<\/p>\n
Attention is also on US-Iran diplomacy. Oman\u2019s foreign minister said the next round of talks will be held on Thursday in Geneva.<\/p>\n
On Friday, Trump said limited strikes against Iran are possible. Iranian officials said Tehran expected a possible agreement to be ready in the coming days.<\/p>\n
Markets will also watch US Producer Price Index data due on Friday. The figures may affect expectations for US Federal Reserve interest rate decisions.<\/p>\n
Central banks are the largest gold holders. The World Gold Council reported they added 1,136 tonnes worth about $70 billion in 2022, the highest yearly purchase on record.<\/p>\n
Given the tension between trade-war fears and hopes for a US-Iran deal, we see a surge in gold’s implied volatility. This suggests that options strategies, which profit from large price swings, are more suitable than direct futures positions right now. The market is pricing in a significant move, and traders should prepare for either a breakout or a sharp reversal this week.<\/p>\n
The new global tariffs are a powerful catalyst for gold, reminding us of the uncertainty we saw during the 2018-2019 trade disputes which supported precious metals. This is happening on top of a multi-year trend of central bank accumulation; we saw them add a record 1,037 tonnes in 2023 and continue heavy buying through 2025. This strong underlying demand provides a solid floor for prices, making dips attractive buying opportunities for long-term bulls.<\/p>\n
However, the US-Iran talks on Thursday present a major risk for anyone holding long positions. We have seen in the past how quickly geopolitical risk premiums can evaporate from the gold price following successful negotiations. A surprise agreement could easily trigger a wave of profit-taking and push gold back below the $5,000 psychological level.<\/p>\n
The Producer Price Index report on Friday will be the next major hurdle for the metal. We remember how stubborn inflation proved to be back in 2024 and 2025, and any sign of resurgent price pressures could force the Fed to maintain a hawkish stance. As a non-yielding asset, gold typically struggles when interest rates are expected to remain high.<\/p>\n
With a major binary event on Thursday, traders should consider strategies that benefit from a large move in either direction, such as a long straddle. By buying both a call and a put option, a position can profit whether the talks fail and send gold soaring or succeed and cause it to drop. The key will be whether the resulting price move is large enough to offset the high cost of these options.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" Gold hovered near $5,095 as tariff uncertainty and US-Iran tensions boosted safe-haven demand ahead of US PPI.<\/p>\n","protected":false},"author":62,"featured_media":16981,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-42495","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/42495","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=42495"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/42495\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16981"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=42495"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=42495"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=42495"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}