Market Digest

Markets were driven by a major geopolitical turning point as a US–Iran ceasefire triggered a sharp shift in global sentiment, removing the war-driven risk premium across key asset classes.

Oil markets reacted most aggressively, with WTI crude collapsing from above $106 toward the low $90s as fears of supply disruption eased following the reopening of the Strait of Hormuz. The rapid unwinding of geopolitical risk repriced inflation expectations lower and eased pressure on central banks.

Gold initially surged on the back of falling bond yields and a weaker US dollar, as markets adjusted to softer inflation expectations. However, the rally proved short-lived as improving risk appetite reduced safe-haven demand, leading to a partial reversal in bullion prices.

In the currency markets, the US dollar weakened broadly despite a relatively hawkish tone in FOMC communications. The decline was primarily driven by falling oil prices, easing inflation fears, and a shift toward risk-on sentiment.

The New Zealand dollar emerged as the top performer, supported by a hawkish hold from the Reserve Bank of New Zealand, which signaled the possibility of future rate hikes. Meanwhile, the British pound strengthened on USD weakness, though gains showed signs of exhaustion near key resistance levels.

Overall, markets are now positioned at critical inflection points, with volatility expected to remain elevated as traders reassess macro conditions ahead of key US inflation data.

Technical Analysis

NZD/USD – Rebounds from Key Support but Faces EMA Resistance Zone

NZD/USD is attempting a short-term recovery after rebounding from the 0.5680 support zone, with price now pushing above the 20 EMA and testing the 50 EMA resistance.

While early signals suggest bullish continuation, the broader trend remains bearish as price holds below the 100 and 200 EMAs. MACD continues to reflect a bearish crossover, although downside momentum is weakening.

A confirmed break above 0.5870 is required to shift sentiment toward a bullish outlook. Failure to sustain above the 50 EMA could trigger renewed downside pressure toward 0.5680.

Key Levels:
Resistance: 0.5870, 0.5950
Support: 0.5680, 0.5580

GBP/USD – Breaks Above Key EMAs but Faces Overbought Pressure

GBP/USD is showing signs of a short-term bullish reversal, supported by a break above the 20 and 50 EMAs and a move into the 1.3430 resistance zone.

Momentum indicators reflect improving upside conditions, though the move above the upper Bollinger Band suggests overextension and raises the risk of a near-term pullback.

A sustained break above 1.3430 would confirm stronger bullish continuation toward 1.3695. However, failure to hold current levels may result in a retracement toward 1.3185.

Key Levels:
Resistance: 1.3430, 1.3695
Support: 1.3185, 1.3060

XAU/USD – Rebounds Toward Resistance as Momentum Stabilizes

Gold is attempting a recovery after a sharp selloff, with price rebounding from the 4,380 support zone and testing resistance near the 20 and 50 EMAs.

Although bearish pressure is easing, MACD still signals downside risk. The broader bullish structure remains intact, supported by price holding above the 200 EMA.

A break above 4,880 would confirm continuation toward 5,085, while failure could lead to consolidation or a pullback toward support levels.

Key Levels:
Resistance: 4,880, 5,085
Support: 4,380, 4,195

Economic News

Gold – Ceasefire Rally Fades as Risk Appetite Returns

Gold surged following the ceasefire announcement, supported by falling yields and a weaker dollar. However, gains were partially reversed as improving sentiment reduced safe-haven demand.

Key Impact:
XAU/USD spiked toward 4,840–4,850 before settling near 4,710–4,720

Oil – Sharp Collapse as War Premium Unwinds

WTI crude dropped aggressively after the ceasefire reduced supply disruption fears and reopened key shipping routes. Higher US inventories added further downside pressure.

Key Impact:
USOIL fell from above 106.00 toward 90.00–92.00 before stabilizing near 95.00–97.00

NZD – Hawkish RBNZ Drives Strong Outperformance

The RBNZ maintained rates but signaled a tightening bias, boosting expectations of future hikes and driving strong NZD gains across major pairs.

Key Impact:
NZD/USD rallied toward 0.5850–0.5860
EUR/NZD and GBP/NZD declined sharply

GBP – Sterling Gains on USD Weakness

The pound strengthened on improved global sentiment and USD weakness, although gains showed signs of slowing near resistance levels.

Key Impact:
GBP/USD rose toward 1.3460–1.3480 before retracing

USD – Dollar Weakens Despite Hawkish Fed Tone

The US dollar declined as risk appetite improved and safe-haven demand faded, despite FOMC Minutes signaling a data-dependent but cautious policy outlook.

Key Impact:
USDX dropped toward 98.50 before stabilizing near 99.00

Upcoming Economic Indicators to Watch

United States

Core PCE Price Index (m/m): Forecast 0.4% | Previous 0.4%
Final GDP (q/q): Forecast 0.7% | Previous 0.7%

Core PCE remains the Federal Reserve’s preferred inflation measure and will be critical in shaping rate expectations. Strong data may support the USD, while weaker readings could reinforce easing expectations.