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EUR/USD Price Trades near 1.1650 as bulls look to extends gains above 23.6% Fibo.

  • EUR/USD kicks off the new week on a positive note as US-Iran peace deal hopes undermine the USD.
  • Bets for an interest rate hike by the Fed in 2026 could help limit deeper USD losses and cap spot prices.
  • Acceptance above the 23.6% Fibo. backs the case for a further intraday appreciating move for the pair.

The EUR/USD pair opens with a bullish gap at the start of a new week as renewed optimism over a potential US-Iran peace deal weighs heavily on the safe-haven US Dollar (USD). Spot prices climb back closer to mid-1.1600s during the Asian session, though the broader setup warrants some caution before positioning for an extension of a modest recovery from the lowest level since April 7, around the 1.1575 region, touched last Thursday.

From a technical perspective, the EUR/USD pair is holding above the 23.6% Fibonacci retracement of the April-May downfall. Adding to this, the Relative Strength Index (RSI) is around 58 and a slightly positive Moving Average Convergence Divergence (MACD) reading hints at improving momentum. This, in turn, backs the case for a further intraday appreciating move, though hawkish US Federal Reserve (Fed) bets could limit USD losses and cap spot prices.

Hence, any subsequent move up is more likely to confront an immediate hurdle near the 38.2% Fibo. level, around the 1.1675-1.1680 region. This is followed by the 1.1710 confluence, comprising the 200-period Simple Moving Average (SMA) on the 4-hour chart and the 50% retracement. The said area should keep the near-term bias capped, above which the EUR/USD pair could target the 61.8% level around 1.1740 and the 78.6% retracement at 1.1785 en route to the cycle high at 1.1842.

On the downside, immediate support is located at the 23.6% retracement at 1.1638, with a deeper floor at the Fibonacci structural anchor around 1.1574, where a break would reopen the broader bearish phase.

(The technical analysis of this story was written with the help of an AI tool.)

EUR/USD 4-hour chart

Chart Analysis EUR/USD

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Canadian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD-0.32%-0.37%-0.25%-0.16%-0.57%-0.46%-0.35%
EUR0.32%-0.06%0.07%0.14%-0.26%-0.15%-0.03%
GBP0.37%0.06%0.13%0.20%-0.21%-0.08%0.02%
JPY0.25%-0.07%-0.13%0.08%-0.36%-0.26%-0.15%
CAD0.16%-0.14%-0.20%-0.08%-0.42%-0.32%-0.21%
AUD0.57%0.26%0.21%0.36%0.42%0.11%0.22%
NZD0.46%0.15%0.08%0.26%0.32%-0.11%0.10%
CHF0.35%0.03%-0.02%0.15%0.21%-0.22%-0.10%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

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Swiss Franc advances as risk-on mood weakens USD

  • USD/CHF falls as fading safe-haven demand weakens the US Dollar amid growing optimism over a potential US-Iran agreement.
  • The US and Iran are reportedly close to signing an agreement involving a 60-day ceasefire extension.
  • SNB’s Martin Schlegel stated the central bank remains highly willing to intervene in foreign exchange markets if necessary.

USD/CHF extends its losing streak for the fourth consecutive day, trading around 0.7820 during the Asian hours on Monday. The pair depreciates as the US Dollar (USD) declines on fading safe-haven demand amid increasing optimism over a potential US-Iran agreement, which has eased broader market concerns about inflation and impending Federal Reserve (Fed) interest rate hikes.

According to an Axios report citing a US official, the United States (US) and Iran are close to signing an agreement that involves a 60-day ceasefire extension. Under this proposed deal, the Strait of Hormuz would be reopened, and Iran would agree to clear mines it deployed in the waterway while allowing ships to pass freely. In exchange for these actions, the United States would lift its current blockade on Iranian ports.

However, the downside of the Greenback could be restrained amid rising inflationary pressures, which have shifted the Fed expectation toward potential future interest rate hikes rather than cuts. Markets are currently pricing in a 45.1% probability that the Fed will raise interest rates by 25 basis points by year-end, according to the CME FedWatch tool.

Meanwhile, investors are continuing to assess the future outlook for Federal Reserve policy. This caution comes after Federal Reserve Governor Christopher Waller signaled that he no longer believes the central bank should retain an easing bias in its official policy statement, adding another layer of complexity to the global economic landscape.

Swiss National Bank (SNB) Vice Chairman Martin Schlegel stated last week that the central bank maintains an elevated willingness to intervene in foreign exchange markets if necessary. Schlegel also noted that Swiss inflation currently remains within the central bank’s price stability range. These remarks signal that policymakers continue to monitor both price developments and currency conditions closely.

Meanwhile, traders are seeking fresh cues regarding whether the Swiss National Bank will call for an exit from its dovish monetary policy stance. This heightened scrutiny comes as rising global inflationary pressures persist, driven largely by elevated international oil prices.

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Yen Strengthens as Oil and Dollar Weaken

The Japanese yen appreciated past 159 per dollar on Monday, rebounding from three-week lows as declining oil prices and a softer US dollar supported the currency amid signs that the US and Iran were moving closer to a deal that could reopen the Strait of Hormuz. A full reopening of the key shipping route would offer relief to major Asian economies heavily reliant on Middle Eastern oil imports. Meanwhile, data released last week showed Japan’s core inflation rate slowed to a four-year low in April, reducing pressure on the Bank of Japan to tighten monetary policy in the near term. Even so, the central bank could still consider raising rates as Japan’s economy continues to show resilience. Separately, traders remained cautious about the possibility of currency intervention, with the yen still trading near the 160-per-dollar level that reportedly prompted Tokyo’s intervention efforts in late April and early May.

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Offshore Yuan Rises to Multi-Year High

The offshore yuan strengthened to around 6.78 per dollar on Monday, reaching its strongest level since February 2023, as the greenback weakened amid signs of a diplomatic breakthrough in the Middle East. Over the weekend, a senior US official said that Washington and Tehran are edging closer to a deal that could reopen the Strait of Hormuz. However, President Donald Trump stressed that he would not “rush” into an agreement, while Iranian officials warned that the draft could still collapse. Meanwhile, Chinese President Xi Jinping is reportedly set to visit North Korea as early as this week or in early June, following his recent hosting of Presidents Donald Trump and Vladimir Putin within the span of a week. On the domestic front, investors are also turning their attention to China’s upcoming PMI data releases later this week, which are expected to offer fresh clues on the health of the economy following recent signs of slowing momentum in industrial output and retail sales.

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Euro edges lower to near 1.1600 on US-Iran peace deal uncertainty

  • EUR/USD posts modest losses near 1.1615 in Friday’s early European session. 
  • Mixed signals on the progress of US-Iran ceasefire talks continued to keep traders cautious. 
  • The ECB June rate hike case is nearly sealed, but July is fully open, said Reuters.  

The EUR/USD pair trades with mild losses around 1.1615 during the early European trading hours on Friday. The Euro (EUR) remains weak against the US Dollar (USD) amid mixed headlines surrounding the US-Iran peace deal. Germany’s IFO surveys and Michigan Consumer Sentiment Index report will be released later in the day. 

Traders will closely monitor the progress of US-Iran ceasefire talks. Iranian officials said that the latest proposal from the US partly narrowed the gap between the warring sides, but comments from the Islamic Republic’s Supreme Leader about keeping Tehran’s uranium stockpile and a dispute over tolls in the Strait of Hormuz clouded the outlook for a breakthrough. 

On Wednesday, US President Donald Trump warned that he may resume attacks soon if Iran doesn’t agree to his terms. Any signs of a prolonged conflict or escalating tensions in the Middle East could boost a safe-haven currency such as the Greenback and act as a headwind for the major pair. 

The case for the European Central Bank (ECB) rate hike in June is nearly sealed, but the central bank is likely to be noncommittal about any further move, looking to temper bets for a quick follow-up step in July, according to Reuters. The ECB decided to hold the key interest rates steady ‌in April, but it debated a hike and signalled that a move in the June policy meeting was likely given persistently high energy costs.

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Euro struggles as rising hawkish Fed tone lifts USD

  • EUR/USD falls as a firm US Dollar gained support from rising expectations of a hawkish Federal Reserve stance.
  • President Trump will swear in Kevin Warsh as the US Federal Reserve chair on Friday at the White House.
  • The Euro fell as flash PMI data showed the Euro Area economy shrinking at its fastest pace since late 2023.

EUR/USD remains subdued for the second successive day, trading around 1.1610 during the Asian hours on Friday. The pair depreciates as the US Dollar (USD) remains firm, supported by rising odds of hawkish sentiment surrounding the Federal Reserve (Fed) policy stance.

Prolonged energy disruptions from the ongoing war threaten to feed into core US consumer prices and inflation expectations, which could potentially push the Fed to keep interest rates higher. Furthermore, a stronger US economic growth outlook is adding weight to the case for monetary tightening and boosting the Greenback.

Fed officials remain cautious as they evaluate whether to adjust short-term interest rates. While they are currently holding the federal funds rate steady, policymakers are moving away from the idea of rate cuts and are increasingly open to raising rates if inflation fails to cool down.

The administration of US President Donald Trump announced that Trump will swear in Kevin Warsh as the chair of the US Federal Reserve on Friday at the White House. The new chair succeeds Jerome Powell, whose term expired on Friday but who has continued to serve on a pro-tempore basis until the transition.

On the US data front, the Department of Labor (DOL) showed that Initial Jobless Claims fell by 3,000 to 209,000 during the second week of May, indicating continued resilience in the labor market. Meanwhile, Continuing Jobless Claims increased to 1,782,000 for the week ending May 9, up from 1,776,000 the previous week.

The Euro (EUR) struggles against the US Dollar (USD) as traders reacted to a surprising contraction in the Eurozone economy. According to the latest S&P Global flash PMI data release on Thursday, the Euro Area economy shrank in May at its fastest pace since late 2023, driven by a conflict-fueled surge in living costs that stifled service demand and pushed input price inflation to a three-year high.

Market attention now shifts to upcoming German economic indicators, including the June GfK Consumer Confidence Survey, Q1 GDP figures, and the IFO Business Survey.

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GBP steadies above 1.3400 vs USD on mixed BoE cues, UK political and Iran risks

  • GBP/USD struggles to gain any meaningful traction on Friday amid mixed fundamental cues.
  • UK political uncertainty counters BoE rate hike bets and keeps the GBP bulls on the defensive.
  • Geopolitical risks and hawkish Fed expectations underpin the USD, keeping a lid on the pair.

The GBP/USD pair is seen oscillating in a narrow trading band during the Asian session on Friday, though it remains on track to register modest weekly gains. Spot prices remain capped near the 100-day Exponential Moving Average (EMA) and currently trade around the 1.3425-1.3430 region, nearly unchanged for the day.

The British Pound (GBP) has been struggling to attract any meaningful buyers amid mixed signals over the Bank of England’s (BoE) policy outlook and the UK political uncertainty. In fact, Swati Dhingra, an external MPC member, said that the BoE might not need to raise rates if its “scenario ​B” – where higher energy prices have only moderate second-round effects – materialises. In contrast, fellow external member Catherine Mann warned that high inflation in late 2026 could become embedded in wage deals for 2027.

Meanwhile, BoE Governor Andrew Bailey said on Wednesday that a rise in market interest rates since the start of the Iran war has given the central bank more time to assess the ​economic impact of the conflict. Nevertheless, markets are still pricing in the possibility of at least one interest rate hike by the BoE in 2026. The GBP bulls, however, seem hesitant amid serious leadership challenges to UK Prime Minister Keir Starmer. This, along with a bullish US Dollar (USD), contributes to keeping a lid on the GBP/USD pair.

Despite the incoming positive headlines, investors remain skeptical about a US-Iran peace deal amid major disagreements over Tehran’s nuclear program and a standoff over the critical Strait of Hormuz. In fact, the Islamic Republic’s Supreme Leader, Mojtaba Khamenei, stated that Iran’s uranium enrichment and Tehran’s control over the strategic waterway remain major sticking points in the negotiations. This, along with hawkish US Federal Reserve (Fed) expectations, underpin the USD and cap the GBP/USD pair.

Minutes from the April 28–29 FOMC meeting released on Wednesday revealed that a majority policymakers believe that policy firming would likely become appropriate if inflation continued to run persistently above the 2% target. Traders were quick to react and are now pricing in around a 60% chance that the US central bank will raise borrowing costs by the year-end. This, in turn, assists the USD in preserving its recent strong gains to a six-week high and warrants some caution for the GBP/USD bulls.

US Dollar Price This week

The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Canadian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD0.10%-0.76%0.21%0.29%0.17%-0.46%0.05%
EUR-0.10%-0.87%0.18%0.17%0.05%-0.49%-0.07%
GBP0.76%0.87%1.00%1.05%0.93%0.38%0.78%
JPY-0.21%-0.18%-1.00%0.03%-0.11%-0.72%-0.19%
CAD-0.29%-0.17%-1.05%-0.03%-0.13%-0.75%-0.27%
AUD-0.17%-0.05%-0.93%0.11%0.13%-0.55%-0.06%
NZD0.46%0.49%-0.38%0.72%0.75%0.55%0.40%
CHF-0.05%0.07%-0.78%0.19%0.27%0.06%-0.40%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

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Swiss Franc flattens against US Dollar as investors await US-Iran deal announcement

  • The Swiss Franc ranges around 0.7870 vs. the US Dollar, with investors awaiting US-Iran deal confirmation.
  • The issues regarding the handover of uranium enrichment by Iran to the US and the authority on Hormuz remain unsolved.
  • Flash US S&P Global Manufacturing PMI surprisingly expanded at a faster pace to 55.3 in May.

The Swiss Franc trades flat against the US Dollar (USD) around 0.7870 during the Asian trading session on Friday. The USD/CHF pair consolidates as investors await the confirmation of a prolonged peace deal between the United States (US) and Iran, following the announcement that both sides have reached a “final draft” with mediation from Pakistan.

As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally higher to near 99.27.

On Thursday, market sentiment turned favorable for riskier assets after the Iranian Labour News Agency (ILNA) reported that a final draft between Washington and Tehran has been reached and a deal can be announced within next few hours.

However, Iran still seems not ready to surrender its enriched uranium and wants recognition of its authority on the Strait of Hormuz, Reuters reports.

On the economic data, front preliminary S&P Global Composite PMI data for May has come in steady at 51.7 as an unexpected strong growth in the manufacturing sector activity offsets the impact of moderate expansion in the Services PMI.

In the Swiss economy, investors seek fresh cues regarding whether the Swiss National Bank (SNB) will call for an exit from its dovish monetary policy stance due to rising global inflationary pressures amid elevated oil prices.