The geopolitical climate is once again heating up following the United States’ assault on three Iranian nuclear facilities located in Fordo, Isfahan, and Natanz over the weekend. This action has escalated the risk of broader conflicts in the Middle East and sparked significant volatility in global financial markets. Investors are now closely watching Iran’s potential responses, hoping to avoid further escalation that could disrupt regional stability.
Meanwhile, market focus this evening will be on the release of the US Flash PMI data for the manufacturing and services sectors. Amidst geopolitical uncertainties, this data is expected to serve as a key driver for short-term price movements in the financial markets.
Recommended
Recommended
Recommended
Recommended
Here are the details from Trading Central:
The US Flash PMI for manufacturing will be released at 20:45 WIB; forecast 52 compared to the previous 52.
The US Flash PMI for services will be released at 20:45 WIB; forecast 53 versus the previous 53.7.
GOLD
Gold prices faced selling pressure throughout the European session, dipping to a low of $3,347. This decline occurred amidst rising geopolitical tensions in the Middle East, following the US military’s strikes on Iranian nuclear sites. The strengthening US dollar, considered a safe haven, has also contributed to the downward pressure on gold prices.
However, the decline in gold prices appears to be somewhat limited. Anticipations of a slowdown in US manufacturing PMI data could place additional pressure on the US dollar, while the ongoing conflict in the Middle East may support gold prices during tonight’s trading.
OIL
Oil prices are undergoing a correction after reaching a high of $77.61 per barrel while some profit-taking activities take place. Nevertheless, the bullish trend remains intact, particularly driven by escalating geopolitical tensions in the Middle East.
Iran’s warning to close the Strait of Hormuz in retaliation for US military actions could disrupt global oil supplies. This situation may act as a catalyst pushing oil prices higher in tonight’s trade.
EURUSD
The EURUSD pair exhibited high volatility during the European session. After rising to 1.1521 at the start of trading, it fell back to 1.1453. This movement comes amid heightened geopolitical conflicts and the release of German services PMI data showing a score of 49.4, surpassing market expectations of 48.0.
Tonight, downward pressure is expected to dominate, with the intensifying conflict between the US and Iran prompting investors to move away from riskier assets towards safer investments.
GBPUSD
GBPUSD traded weaker during the afternoon session, hitting a low of 1.3370 in the European market. Even though the UK services PMI data came in better than anticipated, it was insufficient to bolster GBPUSD’s strength.
Market sentiment remains clouded by concerns over the geopolitical situation in the Middle East. The conflict now involving not only Iran and Israel but also the United States continues to dampen interest in riskier assets and could result in additional selling pressure on GBPUSD during tonight’s session in the US.
USDJPY
Strong demand for the US dollar amidst rising geopolitical tensions has led to selling pressure on the yen, pushing USDJPY higher, nearly reaching its monthly highs in the European session.
The potential for further USDJPY strengthening remains tonight, given the lack of signs indicating de-escalation in the Middle East conflict and the Fed’s stance on maintaining its benchmark interest rates.
NASDAQ
The Nasdaq index showed positive movement, reaching 21,943, even as geopolitical tensions in the Middle East intensified. However, this rally seemed limited as investors remained cautious about possible retaliatory actions from Iran against US military incursions.
The increasing risk-off sentiment due to the escalating conflict could weigh on Nasdaq movements during tonight’s trading session.
