I just noticed something interesting in the gold movement these days. In Monday's Asian session, the precious metal rebounded strongly from the four-day lows near $4,640, recovering much of what it had fallen. The curious thing is that there are reports of diplomatic negotiations between the United States and Iran in the coming days, which provides some relief to the market. Additionally, the dollar failed to maintain its bullish momentum, so gold found some support on that side.

But here’s what has me attentive: the fundamental context remains quite complicated. The U.S. vice president stated that they have already put their best offer on the table, but Iran outright rejected it. Iranian media say that U.S. conditions simply don’t work. Then Trump announces that the Navy will block the Strait of Hormuz, Israel continues attacking Lebanon, and tensions in the Middle East remain high. All of this likely reinforces the dollar as a safe-haven asset, which is not good for gold.

Inflation in the United States is also complicating things. The March CPI rose 0.9% month-over-month and 3.3% year-over-year, the highest increase in nearly four years. Investors have already dismissed the possibility of rate cuts this year and are now talking about potential hikes. U.S. bonds became more attractive, the dollar is strengthening, and gold, which does not generate yield, is under pressure.

Furthermore, if the geopolitical situation continues to drive up energy prices, central banks could become even more aggressive, further limiting gold’s upside potential. WTI crude already rebounded to $105 per barrel. So for now, I remain cautious. Gold has some support floor, but the fundamentals do not invite short-term optimism.