The geopolitical situation is driving prices again as the US and Iran failed to come to an agreement, and the ceasefire deal is now in question. According to some sources, the US president is considering resuming hostilities in the region, which is currently priced in by market participants. The Strait of Hormuz remains closed, and hopes for a quick reopening are fading. Global uncertainty is widely supported by the departure of the UAE from OPEC and OPEC+. 

The Fed left the Federal Funds rate unchanged in April, but market participants are looking at the past and upcoming data to try to predict the next Fed move. It is worth mentioning that the vote for a new FOMC president will take place today. Kevin Walsh is likely to be the next Fed chair, but under current conditions, the situation is unlikely to change drastically. The Fed is not planning to cut rates in the near future, and it is still unclear whether the central bank will make any easing move in 2026. Moreover, if inflation pressure grows, we could see a rate hike at the beginning of 2027.

On the global side, China posted a positive imports report, adding 8,4% YoY, while the PPI accelerated to 1.6%, the highest level in months, which confirms that Beijing is leaving the deflationary harbor. Today’s US CPI data may also be very important, as it will help market participants assess what to expect from the Fed.

EUR/USD: Diplomatic Stalemate and Diverging Central Bank Paths

The euro remains under pressure as demand for risky assets evaporates amid the growing tensions in the Middle East. In this situation, Euronzone will not benefit from quick de-escalation, and the US dollar is getting stronger again due to safe-haven demand. The ECB is looking for easing opportunities as markets are pricing in additional rate cuts this year. By doing this, the central bank will try to support economic growth.

From a technical analysis perspective, the currency pair is testing the lower band of the Bollinger Bands indicator, meaning bears are trying to put EUR/USD lower. Sellers can step in from 1.1730 targeting 1.1650 and 1.1600. Buyers can engage above 1.1760, targeting 1.1800 and 1.1850.

GBP/USD: The BoE’s Hawkish Dilemma

The British pound is trading under pressure amid geopolitical tensions in the Middle East. However, some support comes from a distinctly hawkish tilt by the BoE. At the latest meeting on April 29, one member voted for a rate hike to 4%. Market participants are pricing in additional hikes before the end of 2026. 

From a technical analysis perspective, the British pound is trading close to the lower band of the Bollinger Bands indicator, with bears getting stronger. Sellers can step in below 1.3510, targeting 1.3450 and 1.3400. On the upside, buyers can engage above 1.3540 targeting 1.3600 and 1.3650.

WTI Crude Oil: China Demand Meets Persistent Supply Disruption

Oil supply disruptions are the key driver that helps oil prices reach higher levels. The blockade premium surged after the Gulf of Oman strike. Supply chains continue to be rerouted away from the Strait of Hormuz, and the market prices reflect higher energy costs. 

From a technical analysis perspective, WTI is trading close to the upper band of the Bollinger Bands indicator, meaning that bulls are controlling the market. Traders can buy above 98.80, targeting 100.00 and 105.00. On the downside, traders can sell from 96.30, targeting 92.00.

Gold: The Crossfire Between Safe-Haven Demand and Real Yields

Gold is trading at a crossroads as rising geopolitical tensions support safe-haven assets, but gold is one without yield, which supports the US dollar instead of supporting the precious metal. As long as the Fed remains on hold, the US dollar will be supported by the financial market participants.

From a technical analysis perspective, Gold is trading close to the bottom line of the Bollinger Bands indicator. Sellets can step in below 4,680, targeting 4,640 and 4,620. On the upside, buyers can buy from 4,700 targeting 4,740 and 4,760.