Schnabel said the ECB has effectively moved beyond the adverse scenario outlined in its March projections, which assumed a rapid normalization of oil prices. From a resilience perspective, she argued, that scenario is no longer plausible. Crucially, and in contrast with some more cautious colleagues, Schnabel warned of early signs of a second wave of inflation as the shock to energy prices begins to spread into other items in the consumer basket. "Turning a blind eye to what is happening is no longer an option," she said.

Rhetoric in the Governing Council has widened in recent days and remains heterogeneous. Joachim Nagel, president of the Deutsche Bundesbank, warned last week that the euro area economy is moving toward an adverse scenario rather than the baseline and favored a June hike. Pierre Wunsch called market expectations of three 25-basis-point hikes this year "reasonable." Christodoulos Patsalides also indicated that conditions point towards a June rate increase.

There are dissenting voices. Yannis Stournaras last week cautioned against unduly tight policy given weak growth, while Francois Villeroy de Galhau urged caution, noting that second-round effects had not yet materialized. Schnabel explicitly rejected that line of argument.

Markets have already fully priced a 25-basis-point increase for the ECB meeting on 11 June. The key event will be the publication of updated macroeconomic projections; ECB staff will present three scenarios—baseline, adverse, and severe — and those numbers will guide not only the June decision but also the subsequent path of policy. Schnabel, however, said the ECB should avoid pledging a path beyond June, noting that each subsequent step must depend on the data. The tone is broadly positive for the euro, but the extent of any appreciation will be constrained by a weakening euro area economy and continued uncertainty over the Strait of Hormuz.

The current technical analysis of the EUR/USD pair suggests that buyers should consider taking 1.1650. Clearing that level would allow a test of 1.1680 and could extend to 1.1700, although advancing beyond that point without support from large players is likely to prove difficult. The next target on a successful push would be 1.1721. On the downside, only buying interest near 1.1635 would prompt significant action from major buyers; absent that support, it would be prudent to wait for a break of the 1.1610 low or consider long entries from 1.1585.

As for the GBP/USD, buyers need to clear resistance at 1.3500 to target 1.3530; advancing above that level could be difficult, with a further target at 1.3560. If the pair falls, bears will look to establish control at 1.3450. A confirmed break below 1.3450 would likely inflict meaningful damage on bullish positions and could push GBP/USD toward 1.3390, with a potential extension to 1.3345.

The test of the 159.15 price level occurred at a moment when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential. For this reason, I did not buy the dollar.

The pair is gradually approaching the psychological level of 160 yen, from which the Bank of Japan has actively intervened in recent months. Therefore, it is not surprising that there are relatively few buyers at current prices.

In the second half of the day, U.S. consumer confidence data and housing price dynamics are expected. However, the main focus will most likely remain on the Middle East situation. Geopolitical factors act as a key driver of global economic trends, prompting investors to reassess portfolios and seek safety in reliable assets. This directly concerns the yen, which is sensitive to energy import costs.

As for the data, U.S. consumer confidence, as an indicator of domestic demand, is important for assessing the state of the American economy. However, under current conditions, no particularly positive outcome is expected. Strong figures could support the dollar, but their impact is likely to be limited in the context of overall global instability.

As for the intraday strategy, I will continue to rely mainly on Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1

Today I plan to buy USD/JPY when the entry point at around 159.21 is reached (green line on the chart), with a target of 159.52 (thicker green line on the chart). At 159.52, I will exit buy positions and open short positions in the opposite direction (expecting a 30–35 point move in the opposite direction from the level). Upward potential today may materialize only on negative news regarding the agreement.

Important: Before buying, make sure the MACD indicator is above the zero line and has just begun rising from it.

Scenario No. 2

I also plan to buy USD/JPY if there are two consecutive tests of the 159.05 level while the MACD indicator is in oversold territory. This would limit downward potential and lead to a reversal upward. In this case, a move toward 159.21 and 159.52 can be expected.

Sell Signal

Scenario No. 1

I plan to sell USD/JPY after a break below the 159.05 level (red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers is 158.75, where I will exit shorts and immediately open long positions in the opposite direction (expecting a 20–25 point rebound). Pressure on the pair may return today if peace is achieved.

Important: Before selling, make sure the MACD indicator is below the zero line and has just begun falling from it.

Scenario No. 2

I also plan to sell USD/JPY if there are two consecutive tests of the 159.21 level while the MACD indicator is in overbought territory. This would limit upward potential and lead to a downward reversal. A decline toward 159.05 and 158.75 can then be expected.

What Is on the Chart

• Thin green line – entry price for buying the instrument
• Thick green line – estimated Take Profit level or area for manually locking in profits, since further growth above this level is unlikely
• Thin red line – entry price for selling the instrument
• Thick red line – estimated Take Profit level or area for manually locking in profits, since further decline below this level is unlikely
• MACD indicator – when entering trades, it is important to use overbought and oversold zones

Important Notice

Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price swings. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

And remember: a successful trading approach requires a clear trading plan, similar to the one presented above. Spontaneous decision-making based on current market conditions is, from the outset, a losing intraday trading strategy.

The test of the 1.3470 price level occurred at a moment when the MACD indicator had already moved significantly below the zero line, which limited the pair's downward potential. The second test of 1.3470 coincided with the MACD being in oversold territory, which led to the execution of Scenario No. 2 (buying the pound) and resulted in a 14-point rise in the pair.

Retail sales data from the Confederation of British Industry (CBI) went largely unnoticed by traders and had no significant impact on the British pound. The CBI report, which is intended to reflect current retail sales dynamics, showed a mixed picture without clear signals for a sharp shift in market sentiment.

Going forward, attention will shift to U.S. data. Consumer confidence figures in the United States are expected. This indicator, as a barometer of consumer sentiment, plays an important role in assessing potential consumer demand, which in turn is one of the key drivers of economic growth. A decline in consumer confidence may signal an upcoming slowdown in spending, which could indirectly influence Federal Reserve monetary policy decisions.

In addition to consumer confidence data, the housing price index will also be released. This indicator reflects changes in residential real estate prices, which are directly linked to household wealth and purchasing power. Rising house prices are generally associated with increased consumer spending, while declining prices may indicate the opposite. Traders will closely analyze these figures to assess the stability of the U.S. housing market and its impact on the overall inflation outlook. Weak data will put pressure on the dollar.

As for the intraday strategy, I will continue to rely mainly on Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1

Today, I plan to buy the pound when the entry point at around 1.3485 is reached (green line on the chart), with a target of 1.3520 (thicker green line on the chart). Around 1.3520, I will exit buy positions and open short positions in the opposite direction, expecting a 30–35 point reversal. Pound growth today can only be expected after weak U.S. data.

Important: Before buying, make sure the MACD indicator is above the zero line and has just begun rising from it.

Scenario No. 2

I also plan to buy the pound if there are two consecutive tests of the 1.3470 level while the MACD indicator is in oversold territory. This would limit downward potential and lead to a reversal upward. In this case, growth toward 1.3485 and 1.3520 can be expected.

Sell Signal

Scenario No. 1

I plan to sell the pound after a break below the 1.3470 level (red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers is 1.3437, where I will exit shorts and immediately open long positions in the opposite direction (expecting a 20–25 point rebound). Pressure on the pound may return today if negotiations fail.

Important: Before selling, make sure the MACD indicator is below the zero line and has just begun falling from it.

Scenario No. 2

I also plan to sell the pound if there are two consecutive tests of the 1.3485 level while the MACD indicator is in overbought territory. This would limit upward potential and lead to a downward reversal. A decline toward 1.3470 and 1.3437 can be expected.

What Is on the Chart

• Thin green line – entry price for buying the instrument
• Thick green line – estimated Take Profit level or area for manually locking in profits, since further growth above this level is unlikely
• Thin red line – entry price for selling the instrument
• Thick red line – estimated Take Profit level or area for manually locking in profits, since further decline below this level is unlikely
• MACD indicator – when entering trades, it is important to consider overbought and oversold zones

Important Notice

Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

And remember: successful trading requires a clear trading plan, similar to the one presented above. Spontaneous trading decisions based solely on current market conditions are, from the outset, a losing strategy for intraday traders.

Due to low market volatility, the price did not reach the levels I identified during the first half of the day.

Given the absence of important fundamental data from the Eurozone and the lack of new geopolitical shocks, the EUR/USD pair continued trading within a range. The absence of clear signals pointing to either accelerating or slowing economic growth in the region is preventing traders from making aggressive bets in either direction. This has created a consolidation period in which the currency pair fluctuates within relatively narrow boundaries, giving neither buyers nor sellers a clear advantage. In the short term, the pair is likely to remain within the current range unless unexpected news emerges.

In the second half of the day, only U.S. consumer confidence figures and housing price index data are expected. However, geopolitical tensions are currently far more important. While U.S. data may trigger short-term fluctuations, they are likely to remain secondary unless they differ significantly from forecasts. Any news related to negotiations, military actions, or diplomatic efforts could provoke sharp market movements.

As for the intraday strategy, I will rely mainly on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1

Today, buying the euro is possible once the price reaches the 1.1650 level (green line on the chart), with a target at 1.1678. At 1.1678, I plan to exit the market and also open short positions in the opposite direction, targeting a 30–35 point move from the entry level. Euro growth today can only be expected after positive news.

Important: Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2

I also plan to buy the euro today if there are two consecutive tests of the 1.1633 price level while the MACD indicator is in oversold territory. This would limit the pair's downward potential and lead to a reversal upward. In this case, growth toward the opposite levels of 1.1650 and 1.1678 can be expected.

Sell Signal

Scenario No. 1

I plan to sell the euro after the price reaches the 1.1633 level (red line on the chart). The target will be 1.1601, where I intend to exit the market and immediately open long positions in the opposite direction, expecting a 20–25 point rebound from the level. Pressure on the pair will return today if negotiations fail.

Important: Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.

Scenario No. 2

I also plan to sell the euro today if there are two consecutive tests of the 1.1650 price level while the MACD indicator is in overbought territory. This would limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.1633 and 1.1601 can then be expected.

Chart Explanation

• Thin green line – entry price for buy positions;
• Thick green line – estimated Take Profit level or area for manually locking in profits, since further growth above this level is unlikely;
• Thin red line – entry price for sell positions;
• Thick red line – estimated Take Profit level or area for manually locking in profits, since further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to pay attention to overbought and oversold zones.

Important

Beginner Forex traders should be very cautious when making market entry decisions. Before the release of major fundamental reports, it is best to stay out of the market in order to avoid sharp price swings. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

And remember: successful trading requires a clear trading plan, like the one presented above. Spontaneous trading decisions based solely on the current market situation are generally a losing strategy for intraday traders.

However, the latest May business activity data came in significantly weaker than expected. Although the manufacturing sector remained in expansion territory, growth slowed from 52.2 to 51.4 points. The services sector showed an even more pessimistic trend, falling into contraction territory at 46.4 points (compared to 47.6 in April). The composite index also declined to 47.5 points.

The ECB is currently maintaining a wait-and-see approach, preserving flexibility in its decision-making. However, incoming data paint a mixed picture. Daily closures of the Strait of Hormuz continue to support elevated oil prices, increasing inflationary pressure. This, in turn, raises the likelihood of a rate hike at the ECB's upcoming June meeting.

Such an economic slowdown could significantly alter expectations regarding ECB policy, since aggressive rate hikes risk triggering a recession in the Eurozone, especially given that there is little reason to expect a meaningful slowdown in inflation in the near future. Even a hypothetical agreement to end the blockade in the Persian Gulf would only partially offset the damage already done. Energy prices are likely to remain high until countries replenish their reserves.

At the same time, expectations for Federal Reserve policy are rapidly shifting toward a more hawkish stance. The market no longer expects rate cuts; instead, one rate hike is now projected before the end of the year, followed by another in March next year. The formal reason for the revision in forecasts was stronger-than-expected U.S. inflation data and resilient producer price index figures. As a result, the balance of risks has suddenly shifted toward a scenario in which U.S. inflation continues to accelerate without an adequate response from the Federal Reserve.

According to the latest CFTC report, speculative positioning in the euro is close to neutral, while the estimated fair value continues to decline steadily.

Last week, we noted the increasing likelihood of a downward move in EUR/USD, and this forecast remains unchanged despite the modest rebound following reports about a possible agreement between the United States and Iran. The euro may move somewhat higher in the short term if positive geopolitical news emerges, but upside potential appears limited to the 1.1700 level. We still consider a renewed decline more likely, initially toward the recent low at 1.1575, after which the pair could potentially move toward 1.1410.

Given the absence of important fundamental data from the Eurozone and the United Kingdom, the euro and the pound continued trading within sideways ranges. The lack of specific growth or decline drivers allowed prices to remain within established boundaries. All of this suggests that market participants are taking a wait-and-see approach, unwilling to open large positions until a clearer picture of the economic and geopolitical situation emerges.

In the second half of the day, U.S. consumer confidence data and housing price index figures are expected. These macroeconomic indicators typically have a noticeable impact on the U.S. dollar, as they reflect the current state of the American economy and may signal future consumer spending and investment activity. Strong consumer confidence figures and rising housing prices could be interpreted as positive signals, potentially supporting the dollar. However, given the current economic situation, such expectations may be difficult to justify.

Geopolitical tensions remain the key source of uncertainty in global financial markets. Any escalation of the conflict, new diplomatic initiatives, or unexpected statements could trigger sharp movements in the currency market.

If the economic data come out strong, I will rely on the Momentum strategy. If the market shows little reaction to the data, I will continue using the Mean Reversion strategy.

Momentum Strategy (Breakout Trading) for the Second Half of the Day

For EUR/USD

• Buying on a breakout above 1.1659 may lead to euro growth toward 1.1678 and 1.1698;
• Selling on a breakout below 1.1635 may lead to euro weakness toward 1.1609 and 1.1585;

For GBP/USD

• Buying on a breakout above 1.3490 may lead to pound growth toward 1.3529 and 1.3557;
• Selling on a breakout below 1.3460 may lead to pound weakness toward 1.3440 and 1.3390;

For USD/JPY

• Buying on a breakout above 159.25 may lead to dollar growth toward 159.40 and 159.65;
• Selling on a breakout below 158.99 may lead to dollar selling toward 158.55 and 158.25;

Mean Reversion Strategy for the Second Half of the Day

For EUR/USD

• I will look for selling opportunities after a failed breakout above 1.1649 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 1.1621 followed by a return above this level;

For GBP/USD

• I will look for selling opportunities after a failed breakout above 1.3497 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 1.3465 followed by a return above this level;

For AUD/USD

• I will look for selling opportunities after a failed breakout above 0.7175 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 0.7156 followed by a return above this level;

For USD/CAD

• I will look for selling opportunities after a failed breakout above 1.3810 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 1.3788 followed by a return above this level.

Thus, it became known today, Tuesday, that the United States has resumed military operations in the Strait of Hormuz. Several armed Iranian boats were attacked, resulting in casualties. All of this points to the fact that Donald Trump, pursuing a contradictory policy in which he continuously speaks about peace while simultaneously refusing to negotiate with Tehran on mutually beneficial terms, intends to achieve his previously stated goals by any means necessary.

It is no longer a secret that the dynamics of oil futures prices are the key driver for financial markets, as the cost of energy resources is directly linked to inflation prospects and, consequently, to potential interest rate hikes.

Another factor continues to push markets back and forth — uncertainty, which the American president consistently amplifies. The United States, through its leader, appears to be doing everything possible to confuse and pressure the Iranian side. Lacking the ability — at least for now — to launch a full-scale attack on Iran again, Washington is instead conducting verbal attacks against Tehran, attempting to force it into accepting unfavorable conditions.

The continuation of this situation, particularly the closure of the Strait of Hormuz, will keep markets under pressure and maintain asset prices within sideways trading ranges. This can be observed in oil futures, gold, the U.S. dollar on the Forex market, and cryptocurrencies.

What Can Be Expected in the Markets Today?

Much will depend on how U.S. markets open today and how American investors and traders operating through domestic brokers assess the current situation. As long as uncertainty surrounding the negotiations persists, restrained market activity can be expected.

Daily Forecast

EUR/USD

The pair remains within the 1.1590–1.1660 level amid uncertainty surrounding the resolution of the Middle East crisis. It may rise toward the 1.1660 level and then reverse downward toward 1.1590 if the market does not receive a new wave of optimism. The 1.1654 level may serve as a selling point.

USDX

The U.S. Dollar Index is also likely to continue trading within the 98.90–99.40 level. After rising toward 99.40, it may reverse and decline toward 98.90. The 99.34 level may serve as a selling point.

The wave structure on the hourly chart currently remains straightforward. The latest completed upward wave failed to break the previous high, while the latest downward wave confidently broke the previous low. Thus, the trend has shifted to "bearish." The temporary ceasefire between Iran and the United States supported the bulls for an entire month, but this was followed by a collapse in hopes for lasting peace. Bulls will only be able to launch a meaningful advance if Iran and the U.S. sign an interim agreement.

There were very few noteworthy global events on Monday, and no economic news at all. Donald Trump once again reported successful negotiations with Iran, which could allow the Strait of Hormuz to reopen in the near future. However, Trump's rhetoric regarding Iran has changed sharply recently. The U.S. leader stated that Iran would either remove all enriched uranium from the country or destroy it completely. At the same time, Trump now says he does not want to rush into signing an agreement "to avoid mistakes." According to the U.S. president, time is working in America's favor, not against it.

The reason behind this sharp shift remains unclear, especially since Trump had previously repeatedly urged Iran to sign an agreement as soon as possible. Now it appears that no one is in a hurry, while no news is coming from Iran at all. Traders still do not understand whether Iran has agreed to an interim deal, whether it is willing to surrender all enriched uranium, or whether it is prepared to reopen the Strait of Hormuz. As a result, the market remains in limbo and is reluctant to commit to either buying or selling.

On the 4-hour chart, the pair rebounded from the 76.4% corrective level at 1.1617 but failed to either continue rising or begin a decline. As a result, the market is in no hurry to open positions or draw conclusions. At the moment, I recommend focusing more on the hourly chart, as price movements remain fairly weak. No emerging divergences are currently visible on any indicators.

Commitments of Traders (COT) Report

During the latest reporting week, professional traders opened 9,249 long positions and 15,936 short positions. Over the seven weeks in February and March, the bulls' overwhelming advantage disappeared due to the war in Iran, while over the past eight weeks the situation has stabilized amid the suspension of hostilities in the Middle East. The total number of long positions held by speculators now stands at 233,000, compared to 199,000 short positions. The gap is once again widening in favor of the euro.

Overall, in the long term, major market participants continue to show strong interest in the euro. Naturally, global events of various kinds — which have been abundant in recent years — continue to influence investor sentiment. At present, the market's focus remains firmly on the Middle East, where the war has merely been paused rather than ended. Therefore, in the near future, the euro and dollar exchange rates will depend less on Federal Reserve or ECB monetary policy and economic data, and more on developments in Iran.

Economic Calendar for the U.S. and the Eurozone

The economic calendar for May 26 contains no notable events. Therefore, the influence of economic data on market sentiment on Tuesday will be absent.

EUR/USD Forecast and Trading Advice

I would recommend selling the pair today if it closes below the 1.1630 level on the hourly chart, with a target at 1.1578. Buy positions could have been opened after a close above the 1.1630 level, with targets at 1.1682 and 1.1745. These trades may still be kept open today.

Fibonacci levels are drawn from 1.1409–1.1850 on the hourly chart and from 1.1474–1.2082 on the 4-hour chart.

The wave situation remains "bearish," as the bulls still lack sufficient positive geopolitical news for a full-scale advance. The latest completed downward wave broke below the previous low, while the new upward wave has not yet exceeded the previous high. Geopolitics has recently started to support the bulls, as a memorandum of understanding between Iran and the United States may soon be signed, while the ceasefire remains in place and could be extended indefinitely as the sides continue negotiations on a final truce.

The news background on Monday was practically nonexistent. Traders had little to focus on during the day. No new or important geopolitical reports emerged, except claims that Iran is allegedly ready to transfer all enriched uranium — but only to China. The accuracy of this report remains uncertain. It is also unclear how much uranium Iran would transfer to China and how much it would retain at secret facilities. Thus, while another seemingly encouraging report has appeared, pointing to the possibility of long-term peace in the Middle East, the market remains cautious toward any unverified information.

Meanwhile, Donald Trump is no longer rushing to sign a deal with Iran. The US president is now concerned about making mistakes and is prepared to wait as long as necessary. It is still unknown when the Strait of Hormuz will reopen. Likewise, there is no clarity on when the memorandum of understanding will be signed. There is plenty of positive rhetoric, but virtually no concrete facts or events. The British pound is rising purely on trader enthusiasm. There were no economic reports on Monday, and none are expected on Tuesday either.

On the 4-hour chart, GBP/USD advanced toward the resistance level at 1.3482–1.3514. A rebound from this zone would allow expectations for a reversal in favor of the US dollar and some decline. However, market movements this week will depend more on geopolitics than on technical analysis. Technical analysis can only be used as a supplementary tool. At the start of the week, geopolitical news flow was extremely limited, leaving trader activity near zero. No emerging divergences are currently visible on any indicators.

Commitments of Traders (COT) Report

Sentiment among the "Non-commercial" category of traders became more bearish again during the latest reporting week. The number of long positions held by speculators fell by 11,530, while short positions increased by 9,718. The gap between long and short positions now effectively stands at 68,000 versus 132,000. Bears have dominated in recent months, which comes as no surprise given the geopolitical situation in the Middle East and the political crisis in the United Kingdom. The bearish advantage is now more than twofold.

I still do not believe in a long-term bearish trend for the British pound, but in the near term everything will depend not on economic indicators, Trump's trade policy, or central bank monetary policy, but on the duration, scale, and consequences of the war in the Middle East. In recent weeks, the market had adjusted to expectations of a prolonged conflict, but recent news suggests that a ceasefire may still be achieved, although it is unlikely to be easy or quick.

Economic Calendar for the U.S. and the U.K.

The economic calendar for May 26 contains no notable entries. Therefore, the influence of the economic backdrop on market sentiment on Tuesday will once again be absent.

GBP/USD Forecast and Trading Advice

Selling opportunities may emerge today if the pair closes below the 1.3454–1.3466 level on the hourly chart, with targets at 1.3408 and 1.3349–1.3355. Buying opportunities were possible after a close above the 1.3454–1.3466 level, targeting 1.3526–1.3539. These positions may still be kept open today.

Fibonacci levels are drawn from 1.3158–1.3655 on the hourly chart and from 1.3866–1.3158 on the 4-hour chart.

On Tuesday, at the start of the European session, gold (XAU/USD) continued to show weakness and remained under pressure, holding below the horizontal resistance level near $4,580, where the 14-day EMA is located. Overall positive sentiment remains limited by mixed signals surrounding a potential peace agreement between the US and Iran, which ultimately supports the U.S. dollar as a safe-haven asset.

At the same time, ongoing geopolitical tensions are contributing to a moderate recovery in oil prices, strengthening inflation expectations and increasing the likelihood of tighter monetary policy by the Federal Reserve. This further supports the dollar and negatively impacts gold.

According to media reports citing U.S. Central Command, American forces carried out self-defense strikes in southern Iran on Monday. The targets reportedly included missile launchers and Iranian boats allegedly involved in laying naval mines. These developments come amid deepening disagreements over Iran's nuclear program and rising tensions around the Strait of Hormuz, reducing the likelihood of a near-term agreement and an end to the conflict, which has already lasted nearly three months.

The situation is further aggravated by statements from U.S. President Donald Trump, who has repeatedly suggested the possibility of expanding military operations if no progress is made in negotiations. Taken together, these factors are sustaining elevated geopolitical risks and supporting the dollar's recovery after its decline to a weekly low on Monday, putting additional pressure on gold prices.

Meanwhile, since the beginning of the conflict, Iran has effectively restricted shipping through the Persian Gulf, affecting around 20% of global oil supplies. The tightening U.S. blockade of Iranian ports, combined with ongoing geopolitical tensions, has contributed to a rebound in oil prices from two-week lows. This has once again intensified concerns that rising energy costs could accelerate inflation and force major central banks, including the Federal Reserve, to maintain a more hawkish monetary policy stance. According to the CME Group's FedWatch tool, market participants are already pricing in the possibility of at least one U.S. interest rate hike in 2026. This increases the attractiveness of the dollar and reduces investor interest in gold.

Market attention is now shifting toward the release of key U.S. macroeconomic indicators — the Personal Consumption Expenditures (PCE) Price Index and the second estimate of GDP, both scheduled for Thursday. These data releases could become the main drivers of dollar dynamics and determine the direction of movement for the XAU/USD pair. In addition, investors should closely monitor developments in the Middle East, as any changes could increase volatility across global financial markets. In the short term, attention should also be paid to the Conference Board Consumer Confidence Index, due for release on Tuesday, which may create short-term trading opportunities.

Overall, the fundamental backdrop points to a continuation of the bearish bias in gold prices.

From a technical perspective, the metal encountered resistance around $4,580 on Monday and continues to trade below the 20-day SMA and below the 14-day exponential moving average (EMA), reflecting a moderately bearish short-term outlook. The $4,580 level remains the first significant resistance level, followed by the 20-day SMA near the psychological $4,600 level. At the same time, the nearest support zone is located around $4,520–$4,500. The next demand zone lies near $4,450 and the 200-day SMA. Oscillators remain in negative territory, indicating that bears currently maintain the upper hand in the market.

At first glance, the S&P 500 appears to be ignoring the US–Iran confrontation. The rally in US equities rests on impressive corporate earnings and economic strength, while geopolitics has receded to the background. However, the longer the Middle East conflict drags on, the more its effects are felt in the equity market.

Treasury yields and oil price dynamics

Geopolitics primarily affects the S&P 500 via the bond market. A rally in Brent has lifted inflation expectations and pushed Treasury yields higher. In theory, that should increase corporates' financing costs, squeeze profits, and trigger a pullback in the broad index. In practice, the decisive factor will be issuers' ability to source more funding elsewhere — and here artificial intelligence is helping materially.

Valuations tell a different story. As Treasury yields rise, equities become more expensive on a risk-adjusted basis. The equity risk premium is currently close to zero, roughly in line with Treasury yields. Treasuries are viewed as the safest assets and equities as risky, so a risk premium should exist; its absence raises the probability of an S&P 500 bubble.

Equity risk premium dynamics

The fact that the S&P 500 is largely ignoring geopolitics could imply limited upside if a lasting peace is reached in the Middle East. In many markets, the reaction would be a complete 180-degree reversal, but not necessarily in equities.

The main beneficiaries of the US–Iran standoff have been oil and the US dollar; the losers have been Treasuries and gold. If the peace returns, Brent and the greenback would likely face a wave of selling, Treasury yields would collapse, and gold would regain demand. The S&P 500 would probably rise too, but any rally is likely to be modest — the market has already priced in expectations of conflict resolution, and much of the move would be a replay of that fact.

Technically, it is worth watching for reversal patterns on the daily S&P 500 chart — 1-2-3 formations and a potential double top. Under that scenario, a correction would be likely. Conversely, if bulls can hold prices above the 7,460 pivot level, that would support further long accumulation.

Ethereum lagged but also saw notable redemptions: about $216 million left the market over the week, following a run of eight consecutive down days recorded earlier. The weekly picture fits a single narrative: large capital is using any local price rebounds to take profits, with no sign of a durable reversal. BlackRock, which twice moved hundreds of millions of dollars in Bitcoin and Ethereum into Coinbase Prime during the week, amplified selling pressure.

At the other end of the market, the altcoin ETF complex tells a different story. The leader last week was HYPE, which attracted $72.4 million and became the main beneficiary of the capital reallocation. It was followed by inflows into XRP ETFs of $22 million and SOL ETFs of $15.6 million. Other tokens gathered token sums: DOGE $861,000; LINK $517,000; LTC $260,000; HBAR $240,000. AVAX and DOT showed no movement. Total inflows into altcoin ETFs amounted to just over $111 million — less than 9 percent of the amount that simultaneously exited Bitcoin ETFs. That contrast makes clear that this was not a rotation from Bitcoin into altcoins but a broader withdrawal of large amounts of money from the crypto market.

Weekly figures sit inside a worrying structural context. Regulatory uncertainty persists: the CLARITY Act risks being pushed from June to July due to a congested congressional schedule, and lawmakers have only eight working weeks left before their August recess. Bitcoin continues to trade with a high correlation to the Nasdaq, losing some of its appeal as an independent asset. In this environment, Brian Armstrong's manifesto listing eight "unfinished tasks" for the financial system reads both as a strategic roadmap and as pressure on regulators: infrastructure for a new financial order is being built, but capital is waiting for clear rules.

Trading recommendations

Buyers of BTC are targeting a return to $78,400, a level that would open a direct path to $80,100 and then to $81,700. A breach above $81,700 would signal attempts to restore the bull market. On the downside, buyers are expected at $76,500. A drop below that area could quickly take Bitcoin toward $74,700, with a further target at $73,100.

As for Ethereum, a clear hold above $2,128 would open a direct route to $2,184. The further target is the high near $2,254. A break above that level would indicate strengthening bullish sentiment and renewed buyer interest. On the downside, buyers are expected at $2,084. A fall below that point could rapidly send Ethereum toward $2,026, with a deeper target at $1,969.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines indicate the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines indicate the 200-day moving average.

A crossover, or a price test of moving averages, typically either halts the move or sparks fresh market momentum.

Negotiations are ongoing; however, the timelines have shifted again. Rubio, speaking in New Delhi, stated that it would take "a few more days" to finalize the wording of the agreement. The outlines of a possible deal remain the same: an extension of the ceasefire for about two months, the U.S. lifting the blockade, and Iran reopening the strait. The sticking point remains Tehran's demand to regulate maritime shipping through this strategically important waterway, which is absolutely unacceptable to Washington, the Arab states, and Europe. There's also uncertainty about what will happen next with Iran's enriched uranium and how the trajectory of Iran's nuclear program will develop.

It's worth noting that the market has heard promises of breakthroughs many times before, which led to nothing. The recent U.S. attacks clearly indicate that it is premature to discuss a peace agreement, let alone its compliance. Both sides have repeatedly claimed success in negotiations or the reopening of the strait over the past months—and each time, nothing materialized. Additionally, another complicating factor has emerged: Israel has announced an increase in strikes against Hezbollah in Lebanon, while Tehran insists that halting hostilities there is a prerequisite for any deal with the U.S. This significantly broadens the scope of negotiations.

Meanwhile, a supply shortfall is increasing. According to the IEA, energy reserves worldwide are declining at record rates—both commercial and strategic reserves in the U.S. are evaporating at an unprecedented pace. This means that even if agreements are reached, the physical restoration of supplies will take time, and prices will not plummet instantly.

For central banks, the situation also remains extremely uncomfortable. European Central Bank Executive Board member Isabel Schnabel stated yesterday that the central bank must raise rates next month, even in the event of a swift resolution to the conflict—an inflationary shock has already occurred, and its effects cannot be mitigated by a single diplomatic document.

Regarding the current technical picture for oil, buyers need to overcome the nearest resistance at $92.50. This will allow targeting $100.40, above which it will be quite difficult to break through. The furthest target will be $106.80. In the event of a decline in oil, bears will try to take control at $86.50. If they succeed, a breakout of the range will deal a significant blow to bullish positions and may push oil down to a low of $81.40, with the prospect of reaching $74.85.

The situation is further complicated by another front. Israel has announced a ramp-up of strikes against Hezbollah during the U.S.-Iran negotiations, while Tehran insists that a cessation of hostilities in Lebanon must be part of any final agreement. In other words, even if the parties reach an agreement regarding the Strait of Hormuz, it does not mean the end of the war in a broader sense.

This is particularly inconvenient for gold. The metal has lost about 14% since the beginning of the conflict and has failed to establish a sustainable recovery—each optimistic headline is followed by a new escalation, and the market has stopped responding to diplomatic signals with the same enthusiasm as before. As long as gold moves in tandem with stocks—up on news of negotiations and down on news of strikes—it does not fully serve its function as a safe-haven asset. Gold will have a chance to recover only after the conflict concludes.

It is worth noting that Brent crude oil has bounced back by approximately 2% today—the strikes raised the risk of prolonged supply disruptions and returned part of yesterday's geopolitical premium. This indicates that inflation risks remain, that interest rates remain high, and that the pressure on gold as a non-yielding asset persists. As long as negotiations proceed in "three steps forward, two steps back" mode, the metal will continue to trade sideways, waiting for the moment when the market finally receives something more tangible than yet another statement of progress.

Regarding the current technical picture for gold, buyers need to overcome the nearest resistance at $4,546. This will allow targeting $4,607, above which breaking through will be quite problematic. The further target will be the area of $4,656. In the event of a decline in gold, bears will aim to take control at $4,481. If they succeed, a breakout of the range will deal a significant blow to bullish positions, pushing gold down to a low of $4,432 with the prospect of reaching $4,372.

Despite all the geopolitical events, there are no particular reasons to buy Bitcoin and Ethereum even at current prices.

A recent report from CryptoQuant indicated that average monthly Bitcoin demand has fallen to its lowest level since the beginning of 2026. This metric reflects real buyer activity in the market—and its drop to a yearly low coincides with already documented weekly statistics: the outflow from Bitcoin ETFs over the past week reached $1.26 billion, while BlackRock shifted hundreds of millions to Coinbase Prime twice over the week. This collection of data paints a picture of a market where sellers clearly dominate over buyers, and institutional capital prefers to secure profits rather than build positions.

However, there are positive aspects. For long-term investors, a drop in demand to extremely low levels has historically served as a counter-signal to buy. The logic is simple: when retail and institutional interest in an asset reaches its bottom, the market has typically already priced in most of the negatives, and there are few sellers left. It is during such times that patient investors with a multi-year horizon traditionally build positions at the most attractive prices. However, this story is not applicable to us as intraday traders, so it's more for understanding the situation rather than making decisions.

As for intraday trading strategies in the cryptocurrency market, the strategy and conditions are described below.

Bitcoin

Buy Scenario

• Scenario #1: I plan to buy Bitcoin today at an entry point around $77,000, targeting a move to $77,500. At $77,500, I will exit the buy trades and sell immediately on the bounce. Before buying on a breakout, ensure the 50-day moving average is below the current price and the Awesome Oscillator is above zero.
• Scenario #2: You can buy Bitcoin from the lower boundary at $76,600 if there is no market reaction to breaking it back towards $77,000 and $77,500.

Sell Scenario

• Scenario #1: I plan to sell Bitcoin today upon reaching an entry point around $76,600, targeting a drop to $76,300. At $76,300, I will exit the sell trades and buy immediately on the bounce. Before selling on the breakout, ensure that the 50-day moving average is above the current price, and the Awesome Oscillator is below zero.
• Scenario #2: You can sell Bitcoin from the upper boundary at $77,000 if there is no market reaction to breaking it back towards $76,600 and $76,300.

Ethereum

Buy Scenario

• Scenario #1: I plan to buy Ethereum today upon reaching an entry point around $2,101, targeting a rise to $2,117. At $2,117, I will exit the buy trades and sell immediately on the bounce. Before buying on a breakout, ensure the 50-day moving average is below the current price and the Awesome Oscillator is above zero.
• Scenario #2: You can buy Ethereum from the lower boundary at $2,088 if there is no market reaction to breaking it back towards $2,101 and $2,117.

Sell Scenario

• Scenario #1: I plan to sell Ethereum today upon reaching an entry point around $2,088, targeting a drop to $2,074. At $2,074, I will exit the sell trades and buy immediately on the bounce. Before selling on the breakout, ensure that the 50-day moving average is above the current price, and the Awesome Oscillator is below zero.
• Scenario #2: You can sell Ethereum from the upper boundary at $2,101 if there is no market reaction to breaking it back towards $2,088 and $2,074.

Today, markets started the day with a sharp sell-off, most visible in futures on US indices. It appears markets are still balancing between cautious optimism over the Iran talks and a fresh flare-up of tensions — US forces struck missile launchers in Iran and boats reportedly attempting to lay mines in the Strait of Hormuz. Oil bounced after yesterday's collapse, but overall risk sentiment in equities and bonds remained relatively constructive.

The 10-year US Treasury yield fell four basis points. Europe's Stoxx 600 was essentially flat following yesterday's 1% gain. The dollar stabilized after weakening against major currencies in the prior session.

The key question now is how durable this optimism is. US officials characterised the strikes as defensive, and President Donald Trump did not abandon the diplomatic track, saying talks are going well. Yet the initial momentum from Sunday's headlines is clearly fading: the timetable for a possible agreement has slipped from "hours" to "days."

Meanwhile, the bond market is sending its own signal. The gap between 5-year and 30-year Treasury yields narrowed to 81 basis points — the tightest since May last year — and recovered only slightly to 83bp after trading resumed. That suggests investors are increasingly pricing in a scenario, in which the Fed under incoming Chair Kevin Warsh will have to hold interest rates higher for longer rather than cut them.

Notably, Trump publicly said on Friday that he wants Warsh to be an independent Fed chair — an apparent attempt to soothe investor concerns about political pressure on the central bank. The market, however, remains cautious: Trump has previously called for rate cuts, and the divergence between his statements and actual market expectations persists.

Technically, the S&P 500 analysis shows that the immediate task for buyers is to overcome the resistance level of $7,547. Doing so would confirm renewed upside and open the path to $7,574. Maintaining control above $7,607 would further strengthen buyers' positions. On the downside, buyers need to defend the $7,518 area. A break below that level would likely push the index back to $7,494 and open the way to $7,474.

The test of the 158.89 price coincided with the MACD indicator moving significantly below the zero mark, which limited the pair's downward potential. For this reason, I did not sell the dollar.

Today, the U.S. dollar has risen sharply, while the Japanese yen has declined. Sharp fluctuations in the currency market were provoked by news of U.S. airstrikes against Iranian vessels in the Strait of Hormuz, which seriously jeopardized the fragile peace agreement. Investors, concerned about escalating tensions in the Middle East, rushed to move their assets into safer instruments. The U.S. dollar, traditionally seen as a safe haven during periods of geopolitical instability, therefore strengthened its position, including against the Japanese yen. This is because Japan, as a major importer of energy resources, will continue to feel the negative effects of rising oil prices if the war between the U.S. and Iran continues, which is detrimental to the national economy and currency.

For the intraday strategy, I will primarily rely on implementing Scenarios #1 and #2.

Buy Scenarios

• Scenario #1: I plan to buy USD/JPY today upon reaching an entry point around 159.15 (the green line on the chart), targeting a move to 159.52 (the thicker green line on the chart). At 159.52, I plan to exit the long positions and open short positions immediately on the bounce, anticipating a 30-35-pip move in the opposite direction from the level. It is best to return to buying the pair during corrections and significant pullbacks in USD/JPY. Important! Before buying, ensure that the MACD indicator is above the zero mark and just beginning to rise from it.
• Scenario #2: I also plan to buy USD/JPY today in the event of two consecutive tests of the price at 158.99 when the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. We can expect growth to the opposing levels of 159.15 and 159.52.

Sell Scenarios

• Scenario #1: I plan to sell USD/JPY today only after the 158.99 level is broken (the red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be the level of 158.64, where I plan to exit the shorts and buy immediately in the opposite direction, anticipating a movement of 20-25 pips in the opposite direction from the level. Sellers may return at any moment with just a hint from the central bank. Important! Before selling, ensure that the MACD indicator is below the zero mark and just beginning to decline from it.
• Scenario #2: I also plan to sell USD/JPY today if the price tests 159.15 twice in a row while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a market reversal downward. We can anticipate a decline to the opposing levels of 158.99 and 158.64.

What the Chart Indicates:

• Thin Green Line: Entry price for buying the trading instrument;
• Thick Green Line: Estimated price where take profit can be set or profits can be locked in, as further growth above this level is unlikely;
• Thin Red Line: Entry price for selling the trading instrument;
• Thick Red Line: Estimated price where take profit can be set or profits can be locked in, as further decline below this level is unlikely;
• MACD Indicator: When entering the market, it's important to consider the overbought and oversold zones.

Important Note:

Novice Forex traders must be very cautious when making market entry decisions. It is best to stay out of the market before important fundamental reports are released to avoid sharp fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.

The test of the price at 1.3495 coincided with the moment when the MACD indicator was just starting to move upward from the zero mark, confirming the correct entry point for buying the pound. As a result, the pair rose by 10 pips.

Today, the U.S. dollar has shown noticeable strengthening against the British pound. Financial markets reacted promptly to alarming news about U.S. Air Force strikes against Iranian targets, including vessels in the Strait of Hormuz and other strategic sites within Iran.

Regarding data, only the retail sales report from the Confederation of British Industry is expected in the first half of the day. Weak figures could increase pressure on the British pound. However, even if the report turns out to be moderately positive, the market is likely to remain cautious. Investors are concerned about the overall state of the economy, not just short-term trends.

For the intraday strategy, I will primarily rely on implementing Scenarios #1 and #2.

Buy Scenarios

• Scenario #1: I plan to buy the pound today upon reaching an entry point around 1.3485 (the green line on the chart) with a target for growth to 1.3520 (the thicker green line on the chart). At around 1.3520, I intend to exit the long positions and open short positions immediately on the bounce, anticipating a 30-35-pip move in the opposite direction from the level. Strong pound growth today is only expected after a breakthrough in the peace agreement. Important! Before buying, ensure that the MACD indicator is above the zero mark and just beginning to rise from it.
• Scenario #2: I also plan to buy the pound today if the price tests 1.3470 twice in a row while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. We can expect growth to the opposing levels of 1.3485 and 1.3520.

Sell Scenarios

• Scenario #1: I plan to sell the pound today after it breaches 1.3470 (the red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be the level of 1.3437, where I plan to exit the shorts and longs immediately in the opposite direction, anticipating a movement of 20-25 pips in the opposite direction from the level. Pressure on the pound may return at any moment. Important! Before selling, ensure that the MACD indicator is below the zero mark and just beginning to decline from it.
• Scenario #2: I also plan to sell the pound today if the price tests 1.3485 twice in a row while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a market reversal downward. We can anticipate a decline to the opposing levels of 1.3470 and 1.3437.

What the Chart Indicates:

• Thin Green Line: Entry price for buying the trading instrument;
• Thick Green Line: Estimated price where take profit can be set or profits can be locked in, as further growth above this level is unlikely;
• Thin Red Line: Entry price for selling the trading instrument;
• Thick Red Line: Estimated price where take profit can be set or profits can be locked in, as further decline below this level is unlikely;
• MACD Indicator: When entering the market, it's important to consider the overbought and oversold zones.

Important Note:

Novice Forex traders must be very cautious when making market entry decisions. It is best to stay out of the market before important fundamental reports are released to avoid sharp fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.

The test of 1.1650 coincided with the MACD indicator moving significantly above the zero mark, which limited the pair's upward potential. For this reason, I did not buy the euro. The second test of 1.1650 prompted the implementation of Scenario #2, which called for selling the euro, resulting in a 12-pip decline in the pair.

The euro spent yesterday moving within a sideways channel, as there were no significant fundamental or geopolitical reasons to break out of it. Today, there is no fundamental data from the Eurozone, so traders' attention will likely shift to the European Central Bank's financial stability report. In the case of weak forecasts, which are expected, pressure on the euro may increase. The expectations of a negative scenario are reinforced by the current economic situation in the region. High inflation remains a serious problem, and the tightening of monetary policy by the ECB, which is anticipated next month, carries recession risks. In such conditions, investors are likely to seek shelter in more reliable assets than the euro. As a result, any information from the ECB report that indicates a worsening of existing problems or the emergence of new ones could trigger a sell-off of the euro.

Regarding the intraday strategy, I will primarily focus on implementing Scenarios #1 and #2.

Buy Scenarios

• Scenario #1: Today, I will buy euros upon reaching an entry point around 1.1650 (the green line on the chart), targeting a move to 1.1678. At 1.1678, I plan to exit the market and sell euros in the opposite direction, anticipating a movement of 30-35 pips from the entry point. Growth in the euro can only be expected after good news regarding the agreement. Important! Before buying, ensure that the MACD indicator is above the zero mark and just starting to rise from it.
• Scenario #2: I also plan to buy euros today if the price tests 1.1628 twice in a row while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. We can expect growth to the opposing levels of 1.1650 and 1.1678.

Sell Scenarios

• Scenario #1: I plan to sell euros once the price reaches 1.1628 (the red line on the chart). The target will be the level of 1.1601, where I plan to exit the market and buy immediately in the opposite direction, anticipating a movement of 20-25 pips in the opposite direction from the level. Pressure on the pair may return at any moment today. Important! Before selling, ensure that the MACD indicator is below the zero mark and just starting to decline from it.
• Scenario #2: I also plan to sell euros today in the event of two consecutive tests of the price at 1.1650 when the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a market reversal downward. We can anticipate a decline to the opposing levels of 1.1628 and 1.1601.

What the Chart Indicates:

• Thin Green Line: Entry price for buying the trading instrument;
• Thick Green Line: Estimated price where take profit can be set or profits can be locked in, as further growth above this level is unlikely;
• Thin Red Line: Entry price for selling the trading instrument;
• Thick Red Line: Estimated price where take profit can be set or profits can be locked in, as further decline below this level is unlikely;
• MACD Indicator: When entering the market, it's important to consider the overbought and oversold zones.

Important Note:

Novice Forex traders must be very cautious when making market entry decisions. It is best to stay out of the market before important fundamental reports are released to avoid sharp fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.

Today, the U.S. dollar showed a strong increase following alarming news about American airstrikes on Iranian vessels in the Strait of Hormuz and other strategic sites in Iran. These actions, which evidently escalate tensions, pose a serious threat to the further development of the peace agreement, which was previously thought to be under negotiation between the United States and the Islamic Republic of Iran. As a result of this geopolitical uncertainty, traders are inclined to prefer safer assets, traditionally including the U.S. dollar.

Regarding data, there are no fundamental data coming from the Eurozone today, which inevitably shifts traders' focus to other, more significant events. Primarily, this concerns the European Central Bank's report on financial stability. Many analysts believe this document could set the tone for further developments in the currency market in the short term. It is expected that the forecasts presented in the report will sound somewhat pessimistic. Weak indicators and cautious statements from the ECB may exert significant pressure on the euro.

As for UK macroeconomic data, today is expected to be relatively calm, at least in the first half of the day. Traders' attention will be on the retail sales report from the Confederation of British Industry. This indicator is traditionally considered one of the leading indicators of the British economy, responding sensitively to changes in consumer demand. If the published data turns out worse than analysts' expectations or shows a downward trend, it could exert additional, substantial pressure on the British pound.

If the data aligns with economists' expectations, it's better to act based on the Mean Reversion strategy. If the data is significantly higher or lower than economists' forecasts, it's best to use the Momentum strategy.

Momentum Strategy (Breakout):

For the EUR/USD Pair

• Buy on breakout above 1.1650, aiming for growth towards 1.1678 and 1.1698;
• Sell on breakout below 1.1630, aiming for a drop towards 1.1609 and 1.1585;

For the GBP/USD Pair

• Buy on breakout above 1.3490, aiming for growth towards 1.3529 and 1.3557;
• Sell on breakout below 1.3465, aiming for a drop towards 1.3440 and 1.3390;

For the USD/JPY Pair

• Buy on breakout above 159.15, aiming for growth towards 159.40 and 159.65;
• Sell on breakout below 158.80, aiming for a drop towards 158.55 and 158.25;

Mean Reversion Strategy (Retracement):

For the EUR/USD Pair

• Look to sell after a failed breakout above 1.1641 if the price returns below this level;
• Look to buy after a failed breakout above 1.1621 if the price returns to this level;

For the GBP/USD Pair

• Look to sell after a failed breakout above 1.3497 if the price returns below this level;
• Look to buy after a failed breakout above 1.3467 if the price returns to this level;

For the AUD/USD Pair

• Look to sell after a failed breakout above 0.7180 if the price returns below this level;
• Look to buy after a failed breakout above 0.7156 if the price returns to this level;

For the USD/CAD Pair

• Look to sell after a failed breakout above 1.3818 if the price returns below this level;
• Look to buy after a failed breakout above 1.3801 if the price returns to this level;

Open Interest: 285,647 contracts (each contract = £62,500). Increased by +2,004 (down from +7,500 the previous week—growth has slowed).

Non-Commercial Traders (Speculators)

• Long: 68,075 (23.8%) — sharp decrease of -11,530 (previous week: 79,605 / +17,032)
• Short: 132,382 (46.3%) — significant increase of +9,718 (previous week: 122,664 / -3,817)
• Spreads: 2,288 (0.8%) — decrease of -5,203

The turnaround compared to last week is striking: speculators, who aggressively bought and covered shorts last week, are now doing the exact opposite—liquidating longs and opening new shorts. The net position deteriorated to -64,307 contracts (from -43,059 the previous week)—this indicates a notable deepening of bearish positioning.

Commercial Traders (Hedgers)

• Long: 190,244 (66.6%) — sharp increase of +20,715 (previous week: 169,529 / -11,403)
• Short: 121,546 (42.6%) — decrease of -3,332 (previous week: 124,878 / +9,630)

Here, too, there is a complete turnaround compared to last week: hedgers actively bought and reduced shorts. Their net position became confidently long (+68,698 contracts), which is traditionally interpreted as a signal that "smart money" expects a rebound in the pound. Number of traders: 25 long / 46 short.

Total

• Long: 260,607 (91.2%)
• Short: 256,216 (89.7%)

The overall dominance of longs is minimal—the market remains in a state of equilibrium.

Non-Reportable — Small Traders

• Long: 25,040 (8.8%) — decrease of -1,978
• Short: 29,431 (10.3%) — increase of +821

Small participants have slightly shifted toward shorts, which aligns with the overall sentiment of speculators.

Over the past week, the pound market has shown a sharp deterioration in positioning among speculators: the net short of non-commercial participants deepened from -43,059 to -64,307 contracts—nearly a one-and-a-half-fold increase in bearish pressure. Notably, this same group was aggressively buying last week (+17,032 longs), creating an illusion of a reversal—now it is clear that this was merely a tactical closure of some shorts, rather than a trend change. In parallel, hedgers executed a mirror maneuver: they increased longs by +20,715 and reduced shorts, which is formally a bullish signal from "smart money." However, this divergence between hedgers and speculators creates high market uncertainty—two major groups are on opposite sides —and until this standoff is resolved, it is difficult to expect clear directional movement.

In combination with the increasing bearish positioning of speculators, this creates an environment where any negative news—be it escalation of conflict or disappointing data on the British economy—could accelerate the decline of GBP/USD.

According to the COT report on EURO FX (CME) as of May 19, 2026:

• Open Interest (Open Interest): 826,019 contracts (each contract being €125,000). Decreased by -3,358 over the week.

Non-Commercial Traders (Speculators)

• Long: 233,251 (28.2% of OI) — increased by +9,249
• Short: 199,738 (24.2% of OI) — increased by +15,936
• Spreads: 35,233 (4.3% of OI) — increased by +3,118

Speculators maintain a net long position (+33,513), but shorts have increased significantly more than longs over the week—this indicates rising caution. Large funds continue to bet on the euro, but confidence is waning. Number of traders: 87 long / 53 short / 33 spreads.

Commercial Traders (Hedgers)

• Long: 471,453 (57.1% of OI) — decreased by -13,929
• Short: 537,988 (65.1% of OI) — decreased by -26,448

Hedgers traditionally stand against the trend—they hold a net short position (-66,535), meaning they are hedging against the risk of a rising euro by selling futures. Over the week, shorts have decreased at a rate twice that of longs, which indirectly gives a bullish signal for the euro. Number of traders: 139 long / 96 short.

Total

• Long: 739,937 (89.6% of OI) — change -1,562
• Short: 772,959 (93.6% of OI) — change -7,394

Non-Reportable — Small Traders

• Long: 86,082 (10.4% of OI) — decreased by -1,796
• Short: 53,060 (6.4% of OI) — increased by +4,036

Despite a slight decrease in total open interest (-3,358), large speculators (Non-Commercial) increased their positions on both sides, with a more substantial addition to shorts (+15,936 vs. +9,249 longs)—this signals growing uncertainty: "smart money" is hedging both ways, not making a definitive bet on a stronger euro. Commercial participants (hedgers), on the other hand, aggressively reduced shorts (-26,448), which is traditionally interpreted as a weakening of pressure from corporate sellers and indirectly supports the euro. The net position of Non-Commercial remains positive (233,251 - 199,738 = +33,513), meaning the speculative community still holds a net long position on the euro, although its growth rate slowed over the week—there is evident caution ahead of new inflation data and central bank meetings.

If we look at both EMAs forming a Death Cross intersection and RSI(14) indicator in the Neutral-Bearish level, then Today Litecoin has the potential to continue its weakening toward the nearest support level.

Key Levels

1. Resistance. 2 : 53.77

2. Resistance. 1 : 53.23

3. Pivot : 52.57

4. Support. 1 : 52.03

5. Support. 2 : 51.37

Tactical Scenario

Pressure Zone: If 52.57 is broken down, there is potential for continued weakness toward 52.03.

Momentum Extension Bias: If 52.03 is also breached, Litecoin could continue weakening to test 50.83.

Invalidation Level / Bias Revision

The downside bias is restrained if the price strengthens and breaks above 53.77.

Technical Summary

EMA(50) : 52.74

EMA(200): 53.14

RSI(14) : 39.39

Economic News Release Agenda:

From the United States the following economic data will be released:

US - HPI m/m - 20:00 WIB

US - S&P/CS Composite-20 HPI y/y - 20:00 WIB

US - CB Consumer Confidence - 20:00 WIB

With all technical conditions supporting the weakness in #USDX where it is showing that sellers are clearly dominant, then today #USDX has the potential to continue its decline.

Key Levels

1. Resistance. 2 : 99.34

2. Resistance. 1 : 99.14

3. Pivot : 99.02

4. Support. 1 : 98.82

5. Support. 2 : 98.70

Tactical Scenario

Pressure Zone: If 98.82 is broken down, there is potential for continued weakness toward 98.70.

Momentum Extension Bias: If 98.70 is also broken to the downside, #USDX could continue weakening to 98.50.

Invalidation Level / Bias Revision

The downside bias is restrained if the price breaks above 99.34.

Technical Summary

EMA(50) : 99.01

EMA(200): 99.08

RSI(14) : 53.62

Economic News Release Agenda:

From the United States the following economic data will be released:

US - HPI m/m - 20:00 WIB

US - S&P/CS Composite-20 HPI y/y - 20:00 WIB

US - CB Consumer Confidence - 20:00 WIB

There are no macroeconomic reports scheduled for Tuesday, May 26. Thus, the only topic for discussion in the markets today will be the ceasefire between Iran and the U.S., which has not yet been confirmed by Tehran or by any real facts. If Donald Trump's statements about the proximity of a deal are confirmed, this could trigger a sell-off of the dollar. At the moment, traders are not rushing to part with the American currency, as the leader of the White House has repeatedly provided information that was later disproven.

Analysis of Fundamental Events:

There is also nothing noteworthy among the fundamental events for Tuesday. Market expectations regarding the Federal Reserve's monetary policy have become more "hawkish" lately, but we are currently only talking about a maximum of 1 tightening closer to the end of the year. Expectations regarding the European Central Bank's monetary policy are currently contradictory. On the one hand, inflation is accelerating, while on the other, the EU economy is showing signs of slowing. A rate hike in June seemed predetermined a few weeks ago, but doubts are emerging about the ECB's readiness for aggressive hawkish measures.

The geopolitical backdrop became more encouraging last week, but it is worth recalling that Trump's statements have repeatedly been disproven, and the U.S. president's rhetoric can change several times a day. Negotiations between Washington and Tehran have resumed, and according to the U.S. president, "they are very successful." However, it should be remembered that Trump has claimed breakthroughs in negotiations before. This does not prevent him from threatening Iran with new missile strikes the next day. No confirmations of successful diplomacy have come from Iran. Over the weekend, information emerged that a framework agreement could be signed in the coming days, but, once again, it came from Trump...

General Conclusions:

On the second trading day of the week, both currency pairs may trade quite sluggishly unless new messages emerge regarding the conflict and ceasefire in the Middle East. The euro can be traded today in the range of 1.1655-1.1666, while the British pound can be traded in the range of 1.3456-1.3476. Geopolitics remains the key influencing factor in the currency market.

Main Rules of the Trading System:

1. The strength of the signal is determined by the time it took to form the signal (bounce or breakout of the level). The less time it took, the stronger the signal.
2. If two or more trades were opened near any level based on false signals, all subsequent signals from this level should be ignored.
3. In a flat market, any pair can generate many false signals or none at all. Technical levels may be ignored.
4. On the hourly timeframe, it is preferable to trade signals from the MACD indicator only in the presence of good volatility and a trend that is confirmed by a trend line or trend channel.
5. If two levels are too close together (5-20 pips apart), treat them as a support or resistance zone.
6. After a move of 15 pips in the right direction, a Stop Loss should be set to breakeven.

What is on the Charts:

Price levels (areas) of support and resistance – levels that are targets when opening purchases or sales, or sources of signals.

Red lines – channels or trend lines that display the current trend and indicate which direction is preferable to trade now.

MACD indicator (14, 22, 3) – histogram and signal line – a supporting indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly influence the movement of the currency pair. Therefore, during their release, trading should be done as cautiously as possible, or one should exit the market to avoid a sharp price reversal against the preceding movement.

Beginners trading in the Forex market should remember that not every trade can be profitable. Developing a clear strategy and sound money management are key to long-term trading success.