Market analysis

Date: Monday, 13th of April 2026

EUR/US D : The Middle East ceasefire remains on the brink of collapse

GBP/USD : Pound technical outlook improves slightly amid geopolitical uncertainty

USD/JPY : Yen struggles below 160.00 as intervention fears rise

Dow Jones : US Futures Drop, Losses Trimmed on Trump Comments

Gold : Fragile US–Iran ceasefire keeps buyers cautious

Crude Oil : The U.S. set to launch a Hormuz blockade following failed Middle East talks

The Middle East ceasefire remains on the brink of collapse

The EUR/USD pair regained momentum this week, hovering slightly above the 1.1700 level. Risk appetite improved late Tuesday after US President Donald Trump stepped back from threats to strike Iran, easing market tensions. Earlier in the week, markets were rattled as Trump warned of potential attacks on Iran’s infrastructure if the Strait of Hormuz remained closed, even issuing extreme remarks that heightened geopolitical fears. However, sentiment shifted after he revealed Iran had proposed a 10-point framework for negotiations, offering a possible path toward de-escalation. A fragile truce involving Israel was introduced, though it excluded Lebanon, where clashes between Tel Aviv and Beirut continued. This ongoing conflict kept investors cautious about the durability of any agreement. By Thursday, tensions resurfaced as Trump criticized Iran for restricting oil flows through the Strait of Hormuz, signaling frustration over the lack of progress. Despite this, markets stayed relatively optimistic ahead of scheduled peace talks in Islamabad, with senior representatives from both the US and Iran expected to participate. Still, the ceasefire remains highly unstable, with continued regional attacks and only partial reopening of the Strait of Hormuz limiting confidence. On the monetary policy front, minutes from the Federal Open Market Committee (FOMC) indicated a dovish stance, with policymakers anticipating potential rate cuts in 2026 if inflation moderates. However, they also flagged risks, noting that rising oil prices could fuel inflation, while geopolitical tensions may weaken the labor market. US economic data painted a mixed picture. The ISM Services PMI slowed to 54 in March, while Durable Goods Orders fell more than expected. Growth concerns intensified as Q4 GDP was revised down to 0.5%, and jobless claims rose to 219K. Meanwhile, inflation picked up, with CPI rising to 3.3%, reinforcing uncertainty around the Fed’s next move and contributing to broader US Dollar weakness. In contrast, Germany showed resilience, with stronger-than-expected Factory Orders and a solid trade surplus. Across the Eurozone, Producer Prices declined and Retail Sales dipped, both in line with expectations. Regarding monetary policy, European Central Bank President Christine Lagarde reiterated readiness to raise rates if inflation pressures persist.

However, markets currently expect the ECB to remain on hold unless energy-driven inflation accelerates due to geopolitical tensions.

EUR/USD

GBP/USD

Pound technical outlook improves slightly amid geopolitical uncertainty

The Pound Sterling (GBP) staged a strong rebound from near four-month lows against the US Dollar (USD), climbing to two-month highs just below the 1.3500 mark. The week began with dominant safe-haven flows, pushing the risk-sensitive Pound to multi-month lows as investors reacted to heightened geopolitical tensions. Market sentiment was rattled after US President Donald Trump escalated pressure on Iran, warning of action if the Strait of Hormuz was not reopened by a set deadline. Iran, in response, signaled the possibility of a “much more devastating” retaliation if civilian targets were struck. This escalation drove investors toward the US Dollar, boosting its safe-haven demand. The Greenback also drew support from stronger expectations around the Federal Reserve’s policy outlook, particularly after a robust US jobs report. Data from the Bureau of Labor Statistics showed Nonfarm Payrolls rose by 178K in March, far exceeding expectations, while the unemployment rate unexpectedly declined to 4.3%, reinforcing USD strength. Despite this, GBP/USD showed resilience as the Dollar struggled to maintain gains. The pair gained momentum midweek after a shift in market sentiment following Trump’s so-called “TACO trade,” which weakened the USD. Risk appetite surged after the US and Iran reached a temporary two-week ceasefire and agreed to resume negotiations, raising hopes for a more lasting resolution and the reopening of the Strait of Hormuz. This drove GBP/USD higher, pushing it to fresh two-month highs. However, the rally was short-lived as sellers emerged, driven by uncertainty over whether the ceasefire would hold ahead of upcoming negotiations. Concerns deepened after Iran’s proposal included demands previously rejected by the US. Later in the week, the US Dollar regained some strength as doubts about the durability of the ceasefire offset the impact of the Federal Reserve’s dovish meeting minutes. Geopolitical tensions remained elevated, with Israel continuing strikes against Hezbollah in Lebanon. Israeli Prime Minister Benjamin Netanyahu stated there was “no ceasefire in Lebanon,” further undermining confidence in regional stability. Market sentiment stayed fragile heading into key US-Iran talks and the release of US inflation data. The latest figures showed annual CPI rose to 3.3% in March, in line with expectations, while core inflation increased slightly less than forecast. The muted reaction to inflation data kept the US Dollar from gaining strong traction, allowing GBP/USD to hold near the upper end of its weekly range despite ongoing uncertainties.

GBP/USD

USD/JPY

Yen struggles below 160.00 as intervention fears rise

The USD/JPY pair kicked off the week with a bullish gap, but buying momentum remained limited as the pair struggled to break above the key 160.00 psychological level heading into the European session. Despite the lack of strong follow-through, the broader fundamental backdrop continues to support the pair’s upward bias for a third consecutive day, suggesting potential for further near-term gains. The Japanese Yen (JPY) remains under pressure, weighed down by growing economic concerns linked to escalating geopolitical tensions in the Middle East. A broadly stronger US Dollar (USD) has also provided additional support to USD/JPY. Investors are increasingly worried about the impact of instability in the Strait of Hormuz on Japan’s energy-dependent economy, especially after US President Donald Trump signaled that the US Navy could impose a blockade following the collapse of US-Iran peace talks. After nearly 21 hours of negotiations, talks between the US and Iran ended without any meaningful progress, while continued Israeli strikes in Lebanon have heightened fears of a broader regional escalation. These developments triggered a sharp rise in crude oil prices, fueling global inflation concerns. In Japan, the resulting uptick in government bond yields (JGBs) underscores the country’s vulnerability to external energy shocks, further weakening the Yen. At the same time, the USD continues to benefit from its safe-haven status amid global uncertainty. Additionally, expectations that the Federal Reserve may lean more hawkish—driven by rising inflation risks linked to higher energy prices—are further supporting the Greenback. However, speculation that Japanese authorities could intervene to curb excessive Yen weakness is limiting downside bets on the currency. These intervention fears are capping further upside in USD/JPY, keeping the pair below the 160.00 mark and prompting traders to remain cautious about chasing additional gains at current levels.

USD/JPY

Dow Jones

US Futures Drop, Losses Trimmed on Trump Comments

U.S. stock index futures dropped sharply early Monday after weekend ceasefire talks between the U.S. and Iran collapsed, prompting Washington to move ahead with a naval blockade of the Strait of Hormuz. Markets were already under pressure following data showing a sharp rise in U.S. inflation for March, largely driven by energy costs linked to oil supply disruptions from the Iran conflict. Investors are now bracing for further inflationary pressure if the situation persists. Futures initially fell more than 1% after President Donald Trump announced the blockade, though losses were partially trimmed after U.S. Central Command clarified that the action would target only Iranian ships and ports. The blockade is scheduled to begin at 10:00 ET on Monday. Talks held in Pakistan over the weekend failed to produce a breakthrough, with key disagreements centered around Iran’s nuclear program and the full reopening of the Strait of Hormuz. The collapse of negotiations, combined with the planned blockade, signals limited chances of near-term de-escalation and ongoing disruption to global energy markets. Crude oil prices surged in response, with Brent crude climbing back above $100 per barrel. The move has heightened concerns over sustained energy-driven inflation in the months ahead, reinforcing market caution.

Dow Jones

Gold

Fragile US–Iran ceasefire keeps buyers cautious

Gold (XAU/USD) extended its weekly gains as Middle East developments remained the key driver for the precious metal, a trend likely to persist in the near term. The announcement of a temporary US–Iran ceasefire initially pushed gold to a near three-week high, but the rally lost momentum as doubts emerged over the durability of the truce. Early in the week, tensions escalated after US President Donald Trump set a deadline for Iran to reopen the Strait of Hormuz, threatening strikes on critical infrastructure. Iran responded with warnings of severe retaliation, keeping markets on edge and limiting gold’s early movement. Meanwhile, US economic data showed mixed signals. The ISM Services PMI came in strong at 54 for March, but weakening employment components and rising input costs pointed to growing inflationary pressures. Midweek, markets reacted sharply after Trump agreed to a two-week ceasefire, conditional on reopening Hormuz. Oil prices dropped and the US Dollar weakened, allowing gold to surge to its highest level since March 19, briefly climbing above $4,850. However, optimism quickly faded as renewed geopolitical tensions raised concerns about the sustainability of the ceasefire. Gold reversed gains and settled back near $4,700 as risk sentiment deteriorated. Further uncertainty stemmed from continued conflict involving Israel and Lebanon, with Iran questioning the validity of the ceasefire and reports emerging of disruptions to tanker movement in the Strait of Hormuz. Ongoing military actions and conflicting political statements kept markets cautious, capping gold’s upside .

By the end of the week, US inflation data showed CPI rising to 3.3% in March, in line with expectations, while core inflation came in slightly below forecasts. These figures helped gold stabilize and close the week on a positive note. Analysts noted that gold’s price action remains volatile due to mixed geopolitical signals, where safe-haven demand is offset by shifts in risk sentiment and US Dollar movements. Looking ahead, gold is expected to stay headline-driven, with clarity on the ceasefire’s stability being crucial for determining its next direction.

GOLD

Crude Oil

The U.S. set to launch a Hormuz blockade following failed Middle East talks.

The U.S. military announced it will begin a blockade of the Strait of Hormuz at 10 a.m. Eastern on Monday, targeting vessels entering or leaving Iranian ports and coastal areas, following an order from President Donald Trump after failed weekend negotiations with Iran. However, the Pentagon clarified that ships not linked to Iranian ports will still be allowed to pass through the strait. The move comes after nearly 21 hours of talks between U.S. and Iranian officials in Pakistan ended without an agreement to extend the current two-week ceasefire. U.S. Vice President JD Vance, who led the American delegation, stated that Iran rejected key U.S. demands, including halting its nuclear weapons development. Iran has not issued an immediate response, while Pakistan, acting as mediator, urged both sides to honor the ceasefire commitments. President Trump later confirmed the blockade, accusing Iran of failing to uphold its promise to fully reopen the Strait of Hormuz—a critical route that handles roughly 20% of global oil supply. He also signaled little urgency to resume talks. Despite the breakdown, diplomatic efforts continue. Reports indicate that several countries are working to bring both sides back to negotiations, with a potential second round of talks possible within days. Regional governments are also in discussions to extend the fragile truce. According to reports, U.S. demands included ending Iran’s uranium enrichment program, dismantling key nuclear facilities, surrendering enriched material, reopening Hormuz without restrictions, and cutting ties with proxy groups such as Hezbollah and the Houthis. Iran, however, proposed limited concessions, including reduced enrichment, but the two sides failed to reach a compromise. Iranian Parliament Speaker Mohammad Bagher Qalibaf rejected U.S. pressure, warning that Iran would respond strongly to any escalation.

Meanwhile, uncertainty remains over whether U.S. allies will support the blockade, especially after Trump criticized NATO for its limited involvement. Following these developments, oil prices surged back above $100 per barrel, while global equity markets showed signs of instability.

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MAJOR DATA RELEASED DURING LAST WEEK

MAJOR DATA COMING OUT THIS WEEK (Time zone GMT)

Disclaimer

Moving Average Convergence/Divergence (MACD):

MACD uses different exponential moving averages to generate buy and sell indicators. The lower pane of the chart shows two lines: a Differential Line and a Signal Line. The Differential Line is the difference between a short and long-period exponential moving average, typically 12 and 26 periods. The Signal Line is typically a 9-period exponential moving average. When the DL crosses the SL from above, a sell indicator is generated, and when it crosses from below a buy signal is generated.

Relative Strength Index (RSI):

This is a momentum indicator that measures a security's price in relation to itself. The lower pane of the chart shows a line that fluctuates on a scale of 0 to 100. Typically buy signals are generated at 30 and sell signals are generated at 70. If the line breaks 30, the security is oversold, and a reversal is imminent. If the line breaks 70, it is overbought and is due for a downward correction.

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