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This statement, although well-received by markets as a signal to reduce geopolitical tensions, triggered a wave of uncertainty about the U.S. administration's future actions. Traders, accustomed to Trump's abrupt statements, found themselves in a difficult position trying to assess the real impact of his words on the dynamics of the American currency. The decline of the dollar was driven by expectations of a possible normalization of trade relations and reduced risks, which traditionally leads to the strengthening of other assets.
However, the lack of clear details and specific steps from the White House left room for various interpretations. Against this backdrop, the currency market demonstrated a clear preference for riskier assets. Traders began shifting their focus to currencies of countries whose economies may benefit from a decrease in tensions in the Middle East, such as the euro and the British pound. This reflects the overall desire for a more predictable and stable investment environment, which, at this point, is associated with less volatile geopolitical scenarios.
Oil prices reacted immediately, dropping below the $90 per barrel mark. This came after a significant rise, with the benchmark Brent reaching $119.50 just yesterday morning. Earlier, G7 ministers had declared their readiness to take measures to stabilize energy supplies, including the possible release of strategic reserves, but stated that they are not yet prepared to take such actions.
Additionally, despite the effective closure of the Strait of Hormuz amid the ongoing conflict, President Trump suggested at a press conference that U.S. Navy vessels could escort tankers. This proposal aims to alleviate the restrictions imposed on oil supplies.
Regarding the current technical picture for EUR/USD, buyers need to focus on securing the level of 1.1630. Only then can they target a test of 1.1670. From there, the path could extend to 1.1705, but achieving this without support from major players will be quite problematic. The further target will be the high of 1.1745. If the trading instrument declines to around 1.1590, I expect significant action from major buyers. If there are none, it would be wise to wait for an update of the low at 1.1550 or to open long positions from 1.1510.
As for the current technical picture for GBP/USD, pound buyers need to secure the nearest resistance level at 1.3440. Only then can they aim for 1.3480, above which a breakthrough will be quite challenging. The further target will be the area of 1.3520. In the event of a downturn, bears will likely attempt to take control of 1.3406. If they succeed, breaking this range will deliver a significant blow to the bulls' positions and push GBP/USD down to a low of 1.3374, with the potential to reach 1.3340.
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