The uncertain prospects of a ceasefire between the US and Iran have rocked the global market, with gold falling below $4400 at one point, edging towards a technical bear market.

Due to conflicting signals released by U.S. President Trump on whether the U.S. and Iran can reach an agreement to end the nearly month-long war, the global markets further roiled, leading to a drop in gold prices. On Thursday, gold prices fell by as much as 3.4% at one point, nearing a technical bear market - typically defined as a 20% drop from recent highs, but narrowed some of the decline after Trump announced he would extend the deadline for halting strikes on Iranian energy facilities. Trump posted on social media, "Negotiations are still ongoing," and "Despite the false statements of the so-called 'fake news media' and others, negotiations are progressing very smoothly." As of the time of writing, spot gold rose by 0.44%, nearing $4400 per ounce. Since the start of the war nearly a month ago, gold has been under pressure. Trump criticized the U.S. "fake news media" at a cabinet meeting on Thursday for reporting that he "urgently seeks to end the war through diplomatic means," insisting that it is "Iran who is begging for negotiations." Trump stated, "They are terrible warriors, but they are great negotiators, and they are asking for a deal." He later added, "I don't know if we can do it. I don't know if we're willing to do it." He said that a ceasefire depends on Iran, and in the meantime, U.S. bombings will continue. He also threatened to intensify military operations if negotiations fail. However, Trump later announced that he would extend the deadline to avoid attacking Iranian energy facilities by 10 days, providing a temporary respite for the global energy market. Since the outbreak of the Middle East war nearly a month ago, gold prices have fallen by more than 15%, moving in sync with the stock market, but in the opposite direction to oil prices. The surge in energy prices has heightened inflation risks and led investors to bet that major central banks will maintain or raise interest rates. This is a negative factor for non-yielding gold. However, the prospect of the Federal Reserve raising interest rates may be somewhat limited due to the risks of an economic downturn in the U.S. resulting from prolonged war. Wall Street is downgrading its forecasts for U.S. economic growth this year, while raising forecasts for inflation and unemployment rates, and increasing the likelihood of an economic recession. Furthermore, as hopes for a swift resolution to the conflict fade, oil prices rose on Thursday. Earlier, Iran confirmed that it was waiting for a response, having rejected the U.S.'s 15-point plan to end the war and provided its own conditions. According to calculations, about 85 tons of gold holdings have been redeemed in exchange-traded funds (ETFs) since the outbreak of the war. Analysts at Standard Chartered Bank stated in a report that even at $4500 per ounce, 83 tons of holdings are still in a loss-making position, potentially facing further liquidation risks. Based on Wednesday's closing price of gold, this amounts to approximately $12 billion. Analysts stated, "Overcrowded positions may still face vulnerability in the short term." It is worth mentioning that in the two weeks following the outbreak of the Middle East war, the Central Bank of Turkey sold and exchanged approximately 60 tons of gold, worth over $8 billion, exacerbating downward pressure on gold prices. Some investors are betting on a drop in gold prices through options, with one investor spending over $100 million earlier this week to buy put options on the largest gold-backed ETF. Put options give the buyer the right to sell at a predetermined price, and speculators use them to bet on price declines, while miners use them to lock in high prices. This week, the cost of buying put options relative to buying equal amounts of call options reached a six-year high. Gold investors are betting on a decline in gold prices.