EUR/USD is trading within a narrowing range as markets anxiously await developments regarding the conflict involving Iran. The market is currently balancing between demand for the US dollar as a safe-haven asset and hopes for a diplomatic resolution.
Possible technical scenarios:
On the daily chart, the EUR/USD pair is trading in the middle of the 1.1399–1.1682 range, providing enough room to move toward either of its boundaries.
Fundamental drivers of volatility:
The primary pressure on the pair stems from geopolitical factors, which are boosting demand for the dollar as a defensive asset. The threat of escalation and tough rhetoric from Donald Trump are fueling dollar demand, thereby limiting any upside for EUR/USD. Meanwhile, expectations of a potential last-minute compromise are preventing a deeper decline, creating conditions for sideways price action.
The energy market situation continues to weigh on the euro. Risks of supply disruptions through the Strait of Hormuz are supporting oil prices and inflation expectations, which simultaneously strengthens the dollar through interest rate factors and pressures the euro as the currency of an energy-importing region.
Monetary policy adds another layer of uncertainty. ECB officials are signaling data-dependent decisions and remain in no rush to tighten, while the market maintains a cautious outlook on the regulator’s next steps. Consequently, the interest rate expectations differential remains in favor of the dollar, keeping EUR/USD under pressure in the short term.
Intraday technical picture:
As evidenced by current developments on the 4H chart, the EUR/USD trading range is narrowing within the 1.1399–1.1682 range, forming a symmetrical triangle. A breakout from this pattern is possible in either direction.
GBP/USD has stabilized following a recent decline, supported by a moderate softening of the US dollar despite persistent pressure from UK-specific fundamentals. The pair remains in a downtrend, with any recovery appearing limited in scope.
Possible technical scenarios:
The daily chart demonstrates that GBP/USD continues to trade around the 1.3208 support level. If the price consolidates below this mark, it will clear a path toward the November lows and the 1.3010 target (support indicated by the dotted line). An alternative scenario would involve a local corrective recovery within the existing downtrend.
Fundamental drivers of volatility:
UK monetary policy is exerting a mixed influence on the pound. The Bank of England held interest rates at 3.75%. That being said, the shift in rhetoric from potential easing to a pause is linked to rising energy prices. This keeps rates high but also reflects deteriorating macroeconomic conditions, such as slowing economic growth and rising unemployment, which limits the pound's recovery potential.
Pressure on the dollar from the US side has partially eased. The Services PMI came in below expectations, and a weakening employment component signals an economic slowdown. However, the rise in the prices component points to persistent inflationary pressure, preventing the market from pricing in aggressive Fed easing and limiting the dollar's decline.
The energy market situation and its impact on inflation provide additional influence. Rising energy costs increase inflationary risks in both the US and the UK, but the effect on the pound is more negative due to the weak economic backdrop. As a result, GBP/USD is balancing between short-term dollar weakness and structural pressure on the British currency, maintaining an overall bearish bias.
Intraday technical picture:
Locally, the 4H chart shows a downtrend where the pair has the technical potential for a corrective recovery toward the channel resistance in the 1.3360 area.
The USD/JPY pair is trading near the psychological level of 160.00, cautiously strengthening amid a weak yen and steady demand for the dollar. That being said, gains remain capped due to the risk of currency interventions by Japanese authorities and moderate dollar dynamics.
Possible technical scenarios:
USD/JPY repeatedly returns to the psychological resistance level of 160 yen per dollar but has yet to break through. Without significant fundamental volatility drivers, prices may continue to consolidate between this boundary and the 158.93–161.98 support zone for some time.
Fundamental drivers of volatility:
Key pressure on the yen is being driven by macroeconomic data and expectations regarding Bank of Japan policy. Weak consumer spending figures signal sluggish domestic demand, reducing the likelihood of a near-term rate hike. This lowers the yield on Japanese assets and widens the interest rate differential with the US, supporting USD/JPY growth.
Energy factors are intensifying pressure on the yen. Rising oil prices amid the Middle East conflict are worsening Japan’s trade balance as an energy importer and increasing economic risks. This further limits the Bank of Japan's room for policy tightening and underscores the structural weakness of the JPY.
On the dollar side, support is coming from a reassessment of Fed rate expectations. High energy prices increase inflation risks, lowering the probability of policy easing and supporting US yields. However, concerns regarding currency interventions near the 160.00 level are limiting the pair's upward momentum, creating a zone of high resistance.
Intraday technical picture:
As we can see on the 4H chart, USD/JPY is currently consolidating in a narrow range. The price may decline toward 158.93, followed by potential new attempts to test the psychological resistance at 160.00.
The USD/CAD pair has pulled back from multi-month highs following a moderate weakening of the US dollar and a slight improvement in market sentiment. However, dynamics remain unstable due to the constant flow of conflicting news regarding the Iran-related conflict.
Possible technical scenarios:
On the daily chart, USD/CAD is holding in the middle of the 1.3861–1.4013 range, leaving it positioned to move toward either boundary.
Fundamental drivers of volatility:
Geopolitical factors are influencing the US dollar’s performance within the pair. Reports of a potential ceasefire are temporarily reducing safe-haven demand for the dollar, yet persistent uncertainty and the risk of escalation quickly revive interest in the dollar, limiting the pair’s downside potential.
Commodity dynamics remain crucial for the Canadian dollar. High oil prices support the currency, but energy market instability and risks to global growth make this support fragile and sensitive to conflict-related headlines.
This week, macroeconomic data will serve as an additional volatility driver. In the US, the focus is on inflation reports. The release of CPI and PCE data will shape expectations for the Fed’s future rate path and, consequently, the dollar. In Canada, the key release will be labor market statistics. Employment data will highlight the state of the economy and could adjust Bank of Canada rate expectations. Collectively, these releases, alongside geopolitics, will determine the short-term direction for USD/CAD.
Intraday technical picture:
Judging by the look of things on the 4H chart, local resistance is forming at 1.3945. If the pair fails to overcome this level, prices may pull back toward the 1.3861 support.
Gold is consolidating, trading without a clear direction as the market awaits a resolution regarding Iran and key signals from the Federal Reserve. Investors have taken a wait-and-see stance ahead of the Strait of Hormuz deadline, which is restraining both buying and selling activity.
Possible technical scenarios:
Gold prices have climbed above 4635.63 and are attempting to consolidate. If it turns out to be successful, the rally could continue toward the 4939.80 target. Otherwise, the price may return to the 4375.25–4635.63 range.
Fundamental drivers of volatility:
Geopolitical factors continue to support demand for safe-haven assets, including gold. Escalating conflict and rising tensions create foundational demand for the precious metal. However, a lack of clarity on the outcome and the wait for concrete decisions are keeping participants from taking aggressive positions, shifting the market into a holding pattern.
Energy factors are exerting a contradictory influence. Oil prices rising above $110 strengthen inflation expectations, which theoretically supports gold as a hedge. However, this same factor leads to a reassessment of rate expectations, with the market pricing in tighter policy, which reduces the appeal of gold as a non-yielding asset.
The monetary factor is currently a limiting one. Fed officials are signaling that fighting inflation is a priority, and the market has virtually ruled out rate cuts this year. Anticipation of the Fed minutes and key inflation data (CPI and PCE) makes gold highly sensitive to interest rates. Any higher-for-longer signals will weigh on the metal, while signs of cooling inflationary pressure could revive demand.
Intraday technical picture:
Given the unfolding scenario on the 4H chart, gold is consolidating above the 4635.63 level, creating technical grounds for a subsequent move toward the April 1–2 highs and the 4939.80 resistance.
Brent crude oil prices are holding above $111 per barrel, continuing to rise as the US deadline regarding the Strait of Hormuz approaches, amidst persistent risks of escalation. The oil market remains in a state of high tension, with prices supported by actual supply disruptions and the threat of further infrastructure strikes.
Possible technical scenarios:
On the daily chart, Brent is consolidating above $100 per barrel, continuing to trade in the middle of a broad sideways range between 95.18 and 113.99. From here, prices could head toward either boundary of the corridor, with the ultimate direction determined by fundamental factors.
Fundamental drivers of volatility:
Supply dynamics are having a major impact on price. The actual restriction of transit through the Strait of Hormuz—through which roughly 20% of the world's oil passes—has already led to a reduction in exports from Gulf nations. Additionally, the market is pricing in the risk of long-term supply losses due to damaged energy infrastructure, keeping prices elevated even in the absence of further escalation.
Geopolitical factors are increasing the risk premium. Tough US ultimatums and Iran’s refusal of a temporary truce raise the probability of a military scenario, including strikes on energy facilities. This creates not only a current deficit but also expectations of prolonged supply instability, supporting the market even amid news of potential negotiations.
Global balance and logistics are creating additional pressure. Disruptions in the Middle East are forcing refiners to seek alternative supplies, which is already reflected in rising oil premiums and price imbalances between grades.
Limited capacity for rapid production increases, despite formal OPEC+ decisions, along with new risks (including attacks on export infrastructure in other regions), are intensifying the sense of a deficit and solidifying the upward trend.
Intraday technical picture:
There is no additional data on the 4H chart for Brent; consolidation continues. From the middle of the 95.18–113.99 range, the price could move toward either boundary, with the direction being dictated by fundamental news.
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