Sample Category Title

Brent oil opened with a gap-lower and hit the lowest in more than two weeks on Monday ($96.88), driven by fresh wave of optimism about potential US-Iran peace deal, although key points of negotiations are still to be discussed.

Fresh weakness broke through initial supports, provided by triangle support line / 55DMA ($103.99/$102.73 respectively), dipped below psychological $100 level and penetrated ascending daily cloud (top of the cloud lays at $99.56) also denting Fibo support at $97.23 (61.8% of $86.08/$115.26 upleg).

Technical picture on daily chart weakened as the action continues to gain negative momentum and 10DMA crossed below 20DMA that signals increasing pressure at the downside.

Daily close below $100 (will be the first one in over a month) is needed to confirm negative signal and keep bears for attempts through next pivotal support at $96.09 (May 7 higher low), violation of which to unmask targets at $92.97 (Fibo 76.4%) and $90 (round figure).

Meanwhile, the action may take a breather above cracked $97.23 support and $96.09, due to oversold conditions.

Upticks (in persistent favorable fundamentals) should be limited and mark positioning for fresh push lower, with broken $100 and $100.67 (broken 50% retracement) acting as solid barriers which should ideally cap.

Only stronger bounce that would fill today’s gap and return into triangle, would sideline bears.

Res: 100.00; 100.67; 103.01; 104.64.
Sup: 97.23; 96.09; 94.22; 92.97.

• Rumours of a U.S.-Iran agreement weighed on the dollar.
• The Fed may resume its rate-cutting cycle.

The US dollar opened the week with a small downward gap and is currently down 0.2% on reports of progress in US-Iran negotiations and a potentially imminent deal. Donald Trump stated that the terms of a deal to resolve the conflict peacefully have largely been agreed upon. However, he then noted that he is in no rush and both sides must get everything right. If the Strait of Hormuz reopens soon, it will radically change the situation in the Forex market.

The US dollar has been strengthening for a long time as the likelihood of the Fed tightening monetary policy has increased. As early as the beginning of May, the futures market expected a rate hike in April of next year. Then expectations shifted to March, and then to the end of 2026. At one point, the odds of a monetary tightening cycle starting in December exceeded 60%. If oil prices fall, inflation will follow suit. This should return the Fed to the narrative from the start of the year, when a cut could follow a rate hold.

This is the scenario the White House is banking on. At Kevin Warsh’s swearing-in ceremony, Donald Trump emphasised that the Fed must remain independent. However, he devoted considerable attention to the transitory nature of inflation. The US will combat high prices, but it does not wish to compromise its own greatness. Cutting rates during a strong economy could trigger a real boom in GDP growth.

EURUSD jumped higher on hopes of a peaceful resolution to the conflict in the Middle East. However, previously, everything fell apart when it came to agreeing on the deal terms.

Mediators claim that the memorandum of understanding will extend the ceasefire for at least 60 days. According to them, Iran has demanded the unfreezing of $100 billion of its assets and the lifting of sanctions on oil sales.

An end to the conflict, or even a sharp de-escalation, would provide a tailwind for EURUSD. The eurozone economy has shown signs of a significant slowdown due to rising energy prices. As a result, the futures market has scaled back its expectations regarding the extent of the ECB’s monetary tightening. Earlier, amid rising odds of a federal funds rate hike, speculative net long positions in the dollar rose to their highest level in three weeks. This trend risks reversing

Markets began the week trading as if the Strait of Hormuz is already reopening — even though the final agreement has not yet been signed. Investors rushed into a full-scale “peace dividend” trade after reports suggested the US and Iran are edging closer toward a framework agreement that could end the conflict, restore shipping through Hormuz, and dramatically reduce the risk of a prolonged global energy shock.

The reaction across markets was immediate and aggressive. Oil prices collapsed as traders rapidly unwound geopolitical supply premiums. Brent crude plunged more than -4.5%, crashing through the $100 threshold and sliding to $95 a barrel as fears of a catastrophic energy squeeze eased. The collapse in oil immediately fed through into lower inflation expectations, softer global yields, and a powerful risk-on rally across equities.

Asian markets led the celebration. Japan’s Nikkei 225 exploded 2.9% higher, blasting through 65,000 as energy-importing economies emerged as the biggest beneficiaries of the de-escalation trade. European stocks climbed to their highest levels in more than two months as investors priced a world with lower oil prices, reduced inflation pressure, and less need for central banks to keep policy aggressively tight.

The FX market told a similar story, though with more caution underneath the surface. Dollar weakened broadly as safe-haven demand eased, while Canadian Dollar sank alongside oil prices. Yen also underperformed as traders rotated back into risk assets. Aussie led gains, followed by Sterling and Kiwi, as lower energy costs improved the broader global growth outlook.

But beneath the relief rally, skepticism has not disappeared. Precious metals rose modestly only, suggesting investors are still unwilling to fully abandon geopolitical hedges.

And on the diplomatic side, negotiators continue sending mixed signals. US President Donald Trump warned that any agreement would either be “great and meaningful, or there will be no deal at all,” while Marco Rubio said Washington still has “alternatives” if talks fail.

Iran also poured some cold water on the optimism. Foreign ministry spokesperson Esmaeil Baghaei acknowledged that progress had been made on many issues, but stressed that this does not mean “we’re close to signing an agreement.”

In other words, markets are already trading the reopening of Hormuz before negotiators themselves are willing to declare victory.

That tension may define the next stage of the move. If the deal is finalized and oil continues collapsing, markets could push even deeper into the peace-dividend trade. But if negotiations break down at the final stage, the speed of the current repricing suggests volatility could return just as violently in the opposite direction.

Gold and Silver Bounce, but Traders Still Need Proof on Hormuz Normalization

Gold and Silver rebounded as oil prices fell on hopes that a US-Iran deal could eventually reopen the Strait of Hormuz. But traders are still demanding proof that global energy flows will genuinely normalize before aggressively unwinding geopolitical premiums. Read More.

Hawkish RBNZ, Fragile Aussie: Why AUD/NZD Could Break Hard This Week

AUD/NZD is approaching a critical inflection point as traders brace for a potentially hawkish RBNZ decision and Australian inflation data that could undermine expectations for another RBA hike. Technical momentum is already fading near major resistance levels. Read More.

RBNZ Shadow Board Backs Hold at 2.25%, Three Call for Immediate Hike

NZIER’s RBNZ Shadow Board backed holding the OCR at 2.25% this week, but a growing hawkish minority is pushing for immediate tightening as inflation pressures rise. Three members warned that “the real interest rate has remained low for a prolonged period,” while others argued weak growth and geopolitical uncertainty still justify caution. Read More.

GBP/USD Daily Outlook

GBP/USD's extended rebound suggests that pullback from 1.3657 has completed at 1.3300. Intraday bias is back on the upside for 1.3657 first. Firm break there will resume the rally from 1.3158. On the downside, below 1.3412 minor support will turn intraday bias neutral again.

In the bigger picture, current development suggests that price actions from 1.3867 are merely a corrective pattern within the broader up trend from 1.0351 (2022 low). With 1.3008 support intact, medium term bullishness is maintained and break of 1.3867 is in favor for a later stage, towards 1.4248 key resistance (2021 high). However, firm break of 1.3008 will at least bring deeper fall to 38.2% retracement of 1.0351 to 1.3867 at 1.2524, with increased risk of bearish reversal.

Intraday bias in EUR/USD remains neutral for the moment moment. On the upside, firm break of 1.1660 resistance will argue that fall from 1.1848 has completed as a correction at 1.1575. Intraday bias will be back on the upside for 1.1795 resistance first. On the downside, break of 1.1575 will solidify the case that rebound from 1.1408 has completed at 1.1848, and bring deeper fall back to retest 1.1408 low.

In the bigger picture, the strong support from 38.2% retracement of 1.0176 to 1.2081 at 1.1353 suggests that the pullback from 1.2081 is more likely a corrective move. Strong support was also found in 55 W EMA (now at 1.1544). Focus is back on 1.2 key cluster resistance level. Decisive break there will carry long term bullish implications. Nevertheless, break of 1.1408 support will revive the case of medium term bearish trend reversal.

Intraday bias in USD/JPY remains neutral and some consolidations could be seen below 159.33 first. Above 159.24 will target 160.71 high. Strong resistance is expected from there to start the third leg of the near term corrective pattern. On the downside, break of 157.30 support will turn bias to the downside for retesting 155.01.

In the bigger picture, for now, corrective pattern from 161.94 (2024 high) is still seen as completed at 139.87. Rise from there is seen as resuming the long term up trend. So, break of 161.94 is expected at a later stage to resume the long term up trend. However, sustained break of 55 W EMA (now at 154.53) will dampen this view and bring deeper fall back towards 139.87 to extend the pattern from 161.94.

GBP/USD's extended rebound suggests that pullback from 1.3657 has completed at 1.3300. Intraday bias is back on the upside for 1.3657 first. Firm break there will resume the rally from 1.3158. On the downside, below 1.3412 minor support will turn intraday bias neutral again.

In the bigger picture, current development suggests that price actions from 1.3867 are merely a corrective pattern within the broader up trend from 1.0351 (2022 low). With 1.3008 support intact, medium term bullishness is maintained and break of 1.3867 is in favor for a later stage, towards 1.4248 key resistance (2021 high). However, firm break of 1.3008 will at least bring deeper fall to 38.2% retracement of 1.0351 to 1.3867 at 1.2524, with increased risk of bearish reversal.

USD/CHF's extended decline today suggests that rebound form 0.7760 has completed at 0.7960. Fall from 0.8041 is still in progress. Intraday bias is back on the downside for retesting 0.7760 first. Firm break there will target 61.8% projection of 0.8041 to 0.7774 from 0.7906 at 0.7741. For now, risk will stay on the downside as long as 0.7906 holds, in case of recovery .

In the bigger picture, as long as 55 W EMA (now at 0.8028) holds, fall from 0.9200 is expected to continue, as part of the larger down trend. Firm break of 0.7603 will target 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382.

Intraday bias in AUD/USD remains neutral at this point. On the upside, firm break of 0.7183 resistance will suggest that pullback from 0.7277 has completed. Stronger rally should then be seen to retest 0.7277 high. However, decisive break of 0.7076 will indicate that larger scale correction is underway and target 0.6832 support instead.

In the bigger picture, rise from 0.5913 (2024 low) is still in progress. Decisive break of 61.8% retracement of 0.8006 to 0.5913 at 0.7206 will solidify the case that it's already reversing the down trend from 0.8006 (2021 high). Further rally should then be seen to retest 0.8006. For now, outlook will remain bullish as long as 0.6832 support holds, in case of pullback.

Intraday bias in USD/CAD remains on the upside at this point. Rise from 1.3549 is in progress and it's seen as the third leg of the pattern from 1.3480. Further rally should be seen to 1.3965 resistance. On the downside, below 1.3729 support will turn intraday bias neutral again.

In the bigger picture, price actions from 1.4791 are seen as a corrective pattern to the whole up trend from 1.2005 (2021 low). Deeper fall could be seen, as the pattern extends, to 61.8% retracement of 1.2005 to 1.4791 at 1.3069. However, decisive break of 38.2% retracement of 1.4791 to 1.3480 at 1.3981 will argue that the correction has completed with three waves down to 1.3480 already.

Break of 214.40 resistance suggests that GBP/JPY's rebound from 210.43 is resuming. Intraday bias is back on the upside for retesting 216.58 high. Strong resistance should be seen there to cap upside, at least on first attempt. On the downside, below 213.25 minor support will turn intraday bias neutral again first.

In the bigger picture, while the fall from 216.58 is steep, there is no clear sign of trend reversal yet. The long term up trend could still extend to 61.8% projection of 148.93 (2022 low) to 208.09 (2024 high) from 184.35 at 220.90 on resumption. However, sustained break of 55 W EMA (now at 206.27) will argue that it's already in medium term down trend for 184.35 support.