EUR/USD
The EUR/USD pair posts modest gains around 1.1635 during the early Asian session on Tuesday. Nonetheless, the potential upside might be limited, as Iran announced a halt to US negotiations and a full closure of the Strait of Hormuz, which could prompt risk-off sentiment. The preliminary reading of the Harmonized Index of Consumer Prices (HICP) from the Eurozone will be released later on Tuesday.
GBP/USD
The GBP/USD pair trades in positive territory around 1.3460 during the Asian trading hours on Tuesday. However, renewed tensions in the Middle East might cap the upside for the major pair as Iran has reportedly withdrawn from negotiations with the US. Traders will closely monitor the developments surrounding Middle East peace talks.
USD/JPY
The USD/JPY pair enters a bullish consolidation phase during the Asian session on Tuesday and trades around the 159.70 area, or over a one-month high touched the previous day. However, a combination of diverging forces acts as a headwind for spot prices, warranting caution before positioning for an extension of the recent well-established positive move witnessed over the past four weeks or so.
AUD/USD
The AUD/USD pair loses ground to near 0.7155 during the Asian trading hours on Tuesday, pressured by broader geopolitical uncertainties. Traders await Middle East ceasefire developments and key economic data from both Australia and the United States (US). Australia’s Gross Domestic Product (GDP) report for the first quarter (Q1) is due on Wednesday. The US May Nonfarm Payrolls (NFP) data will be in the spotlight on Friday.
NZD/USD
The NZD/USD pair trades with a negative bias for the second straight day, albeit it lacks bearish conviction and holds above the previous day’s swing low. Spot prices currently trade near the 0.5925-0.5920 region, down around 0.15% for the day on the back of a modest US Dollar (USD) strength.
USD/CAD
USD/CAD extends its gains for the third successive day, trading around 1.3840 during the Asian hours on Tuesday. The pair appreciates as the commodity-linked Canadian Dollar (CAD) struggles on lower oil prices. However, Crude oil prices may regain their ground as Tasnim news agency indicated that Tehran has halted indirect negotiations with the United States.
USD/CHF
USD/CHF moves little after registering modest gains in the previous day, trading around 0.7870 during the Asian hours on Tuesday. The pair steadies as the US Dollar (USD) remains firm on increased safe-haven demand after Tasnim news agency indicated that Tehran has halted indirect negotiations with the United States. Traders await the Swiss Trade Balance data release due later in the day.
CRUDE OIL
Oil prices fell in Asian trade on Tuesday, retaining a bulk of their gains from the prior session as markets remained uncertain over the status of U.S.-Iran ceasefire talks.
Gold (XAU/USD) edges higher during the Asian session on Tuesday, though it lacks bullish conviction and currently trades just above the $4,500 psychological mark. A partial ceasefire between Hezbollah and Israel eases fears of a broader regional conflict, keeping a lid on further gains for the safe-haven US Dollar (USD) and offering support to the bullion. However, the uncertainty around US-Iran peace talks, along with inflation fears and prospects for interest rate hikes, continues to undermine demand for the yellow metal.
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