The US dollar is regaining strength after a recent pullback, supported by lingering uncertainty surrounding geopolitical developments. Mixed signals on US–Iran negotiations — ranging from talk of a possible ceasefire extension to reports of increased military preparations — are creating an uneven outlook for markets and prompting renewed demand for safe-haven assets. As a result, the dollar is attracting buyers again, even in the absence of a strong fundamental driver.
Expectations for upcoming US macroeconomic releases are also lending support, as investors assess how new data may influence the path of interest rates. Nevertheless, geopolitical headlines remain the dominant force, while economic indicators are viewed more as catalysts for short-term volatility. Commodity market trends and shifting expectations for global growth continue to shape the broader market backdrop.
USD/JPY is advancing towards key resistance in the 159.70–160.00 area, reflecting a combination of dollar recovery and reduced safe-haven demand for the yen. If current conditions hold, the pair may extend gains and challenge its March highs. However, failure to break above this zone could trigger a pause or a short-term correction.
AUD/USD continues to trade hesitantly around the 0.7150 level as escalating US-Iran tensions significantly sour global market sentiment. Investors are moving away from riskier assets, putting pressure on the Australian dollar. The pair is trading below its 50-day moving average, a bearish signal, with RSI near 45, indicating neutral to slightly bearish momentum. Key support lies at 0.7150 and 0.7100, while resistance stands at 0.7200 and 0.7250. Analysts note that during the 2020 US-Iran tensions, AUD/USD fell from 0.7000 to 0.6680 in two weeks.
USD/CAD is showing signs of a potential trend reversal after its recent decline, with technical signals including a bullish "piercing pattern" on the daily chart pointing to possible upside towards 1.3700–1.3750. On the downside, a move below 1.3620 would likely renew bearish pressure, opening the way towards 1.3520–1.3560.
The dollar's rebound is being shaped by geopolitical uncertainty and conflicting developments around Iran. Geopolitical shocks often create buying opportunities for the AUD but only after the initial panic subsides. The current hesitation at 0.7150 suggests a market waiting for a clearer catalyst — either a diplomatic breakthrough or further escalation of conflict.
