WTI Faces Pivotal Moment as Conflict Intensifies and Support Holds

Commodity

Energy

Summary:

This rebound suggests that $72.50 may serve as a critical platform for a fresh bullish impulse, with the next upside target being the previous session’s high.

BUY WTI

Close Time

CLOSED

73.422

Entry Price

76.700

71.000

59.984 +0.175 +0.29%

242.2

Pips

Loss

71.000

70.999

Exit Price

73.422

Entry Price

76.700

The United States has officially joined Israel in military operations against Iran, reportedly striking and destroying critical nuclear facilities. This dramatic development could mark a major turning point for global markets, particularly for oil prices and the U.S. dollar, which often benefits during geopolitical shocks—especially when oil prices spike.

In response, Iranian officials have threatened to block the Strait of Hormuz, a vital maritime chokepoint through which nearly 20% of global oil supply flows. Should Tehran carry out this threat, some market sources suggest that crude prices could surge to the $120–$130 per barrel range. The market is now intensely focused on the next moves, with any sign of escalation likely to trigger further upward pressure on oil.

Tehran has also proposed legislation to suspend cooperation with the International Atomic Energy Agency (IAEA), warning of "severe consequences" in retaliation to the attacks. While the U.S. labeled the mission as a one-off strike, President Trump declared the operation a success. However, Israeli Prime Minister Benjamin Netanyahu took a more cautious tone, emphasizing that the nuclear threat has not been fully neutralized, as Iran’s heavily fortified Fordow facility remains intact.

In an effort to deescalate the situation, European diplomats from France, Germany, the United Kingdom, and the European Union held high-level talks with Iran's Deputy Foreign Minister Abbas Araghchi. Although no ceasefire agreement was reached, the meeting signaled a shared preference for diplomacy over open conflict.

From a monetary policy perspective, the Federal Reserve is expected to respond to the inflationary impact of soaring oil prices with a sufficiently restrictive stance. Technically speaking, an improvement in a country’s terms of trade can lead to real exchange rate appreciation—either through nominal exchange rate gains or higher inflation. Both outcomes ultimately reduce the competitiveness of U.S. goods abroad. Which channel prevails depends largely on how the central bank handles inflation expectations and interest rate policy.

In a new and potentially worrying development, Qatar has announced the closure of its airspace to civilian aircraft. Market participants view this as a signal of rising geopolitical risk in the region. If this move precedes a full blockade of the Strait of Hormuz, oil prices could experience a sharp resurgence in the coming sessions. WTI Faces Pivotal Moment as Conflict Intensifies and Support Holds_1

WTI Faces Pivotal Moment as Conflict Intensifies and Support Holds_1

Technical Analysis

Following the U.S. strikes on Iranian nuclear facilities, WTI crude surged to an intraday high of $76.67 during Monday’s market open. The heightened risk of retaliatory action by Iran against U.S. assets and infrastructure in the region has created a fragile environment for energy markets, keeping upward pressure on U.S. oil benchmarks.

WTI has found solid support around the $72.50 zone, a level that has historically acted as a reliable base for bullish reversals. The recent pullback toward this area was met with renewed buying interest, and the price has since recovered above the 100-period moving average. This rebound suggests that $72.50 may serve as a critical platform for a fresh bullish impulse, with the next upside target being the previous session’s high.

Meanwhile, the Relative Strength Index (RSI) has dropped to 36.8, approaching oversold territory. The RSI also reached its lowest level across recent sessions, creating bullish divergence—lower RSI values without corresponding new price lows. This could be an early signal that bearish momentum is weakening.

If the $72.50 level fails to hold, further downside could be expected, with the 200-period moving average at $70.95 acting as the next major support level. However, as long as geopolitical tensions remain elevated, the downside may be limited, and bullish momentum could resume swiftly.

Trading Recommendations

Trading direction: Buy

Entry price: 73.41

Target price: 76.70

Stop loss: 71.00

Validity: Jun 30, 2025 15:00:00

Risk Warnings and Disclaimers

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Warren Takunda

Economic

Summary:

The Australian Dollar rebounded from a one-month low against the US Dollar on Monday as fading geopolitical risk appetite and mixed US PMI data curbed Greenback demand.

BUY AUDUSD

Close Time

CLOSED

0.64350

Entry Price

0.64800

0.63900

0.66472 +0.00089 +0.13%

45.0

Pips

Profit

0.63900

0.64800

Exit Price

0.64350

Entry Price

0.64800

The Australian Dollar (AUD) staged an impressive intraday turnaround against the US Dollar (USD) on Monday, clawing back early-session losses that had pushed the currency pair to its lowest level in nearly a month. While the day began under a cloud of geopolitical tension and risk-off flows — triggered by a weekend U.S. military strike on Iran — market sentiment shifted in New York trading hours as the latest batch of U.S. economic data failed to reinforce bullish conviction in the Dollar.

At the time of writing, AUD/USD is trading near 0.6426, having bounced strongly from the session’s low at 0.6372. The pair was last seen down just 0.38% on the day, after recovering most of the ground lost during the Asian and European sessions. The comeback reflects a broader reassessment of the safe-haven trade and growing investor unease over the sustainability of the Greenback’s recent strength.

The initial bout of Aussie selling was fueled by escalating geopolitical tensions after the United States launched strikes against Iranian targets over the weekend, stoking fears of broader Middle East instability. The USD initially benefited from safe-haven inflows, with global risk sentiment subdued and commodity-linked currencies like the AUD on the back foot.

However, as the session progressed and no immediate retaliatory response from Iran emerged, markets began to unwind some of the safety-driven trades. Traders rotated back into risk-sensitive assets, including the Australian Dollar, as attention shifted from headlines to data.

A key catalyst for the Aussie’s rebound came from the release of mixed US Purchasing Managers’ Index (PMI) data from S&P Global. The Composite PMI dipped slightly to 52.8 in June from 53.0 in May — still signaling expansion, but indicating a marginal loss in momentum.

The Manufacturing PMI came in at 52.0, unchanged from the prior month’s 15-month high and above expectations, suggesting some resilience in the industrial sector. However, the Services PMI — the largest component of the U.S. economy — slipped to 53.1 from 53.7, reflecting softer demand and tempering enthusiasm for the USD.

The data did little to support a stronger case for the Federal Reserve to maintain a hawkish stance, particularly as inflation continues to trend downward and rate expectations for 2024 remain anchored to at least one rate cut before year-end. As a result, the US Dollar’s initial strength faded, giving the Aussie room to retrace losses.

Earlier in the Asia session, Australia’s own PMI data provided a degree of insulation against geopolitical volatility. According to S&P Global, the Australian private sector recorded its second-fastest expansion in ten months. The services sector, in particular, notched a three-month high in activity, while manufacturing held broadly steady — a welcome development for a market that has grown increasingly cautious on the domestic outlook amid soft employment and retail sales data in recent weeks.

The upbeat figures temporarily eased concerns about the Reserve Bank of Australia (RBA) needing to pivot toward policy easing. While some economists still forecast a potential rate cut in late 2024, the stronger PMI print may delay that narrative and keep AUD sentiment anchored in the near term.

Technical Analysis

From a technical perspective, AUD/USD is now testing a key pivot point at 0.6427, which could determine the pair’s direction over the next few sessions.

The Super Trend indicator has generated a clear long signal, and the Pivot Point HL is pointing to a bullish underlying structure in the market. The pair has also managed to hold above recent lows and climb back within a broader consolidation zone, adding to the near-term upside potential.

If momentum continues to build, the next upside target sits near 0.6480 — a level that would mark a full retracement of Monday’s geopolitical-driven drop and challenge short-term resistance.

TRADE RECOMMENDATION

BUY AUDUSD

ENTRY PRICE: 0.6435

STOP LOSS: 0.6390

TAKE PROFIT: 0.6480

Risk Warnings and Disclaimers

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Warren Takunda

Economic

Summary:

USD/CAD extended its rally on Monday, trading near 1.3780, as geopolitical tensions in the Middle East and disappointing Canadian retail data fueled safe-haven demand for the U.S. Dollar

BUY USDCAD

Close Time

CLOSED

1.37500

Entry Price

1.40000

1.36700

1.38167 +0.00020 +0.01%

80.0

Pips

Loss

1.36700

1.36690

Exit Price

1.37500

Entry Price

1.40000

The U.S. Dollar continued to gain ground against the Canadian Dollar on Monday, with the USD/CAD pair trading firmly around 1.3780 in North American hours, after briefly touching a session high of 1.3803. The move extends a strong five-day rally for the pair, underpinned by a renewed wave of geopolitical anxiety and mounting concerns over the Canadian economy’s growth prospects.

Risk sentiment remains on edge after the United States launched airstrikes over the weekend on three Iranian nuclear facilities, an escalation that revived fears of a broader conflict in the Middle East. In a televised statement, former President Donald Trump described the operation as a “very successful attack” and issued a stern warning of additional military responses should Iran retaliate. The strikes raised alarm bells among investors already wary of geopolitical instability and the potential implications for global energy markets.

The airstrikes have intensified concerns around the Strait of Hormuz, one of the world's most strategically vital oil shipping lanes. Although oil prices rose in response, broader risk-off sentiment dominated trading floors, funneling capital into traditional safe-haven assets like the U.S. Dollar and pushing USD/CAD higher.

The U.S. Dollar’s strength has been bolstered by its status as a safe-haven currency during periods of global uncertainty. As markets digest the implications of increased military tension in the Middle East, the greenback has found consistent support — not only against commodity-linked currencies like the Canadian Dollar but also against a broader basket of major peers.

While higher oil prices would typically offer some support to the loonie, that historical correlation has weakened in recent months. This is largely due to a shifting domestic macroeconomic backdrop and an increasingly dovish stance from the Bank of Canada (BoC). As a result, the loonie is struggling to find traction, even amid favorable commodity moves.

Adding further downward pressure on the Canadian Dollar were Friday’s disappointing retail sales figures. According to preliminary estimates from Statistics Canada, retail sales volumes contracted by 1.1% in May — a stark reversal from April’s 0.3% growth and well below market forecasts. The data points to a deterioration in consumer spending, a key driver of domestic economic activity, and reinforces the narrative of a softening Canadian economy.

The weak consumption data comes on the heels of other tepid indicators, including a sluggish labor market and subdued business investment. With inflation cooling and growth indicators softening, markets are increasingly pricing in the likelihood of additional interest rate cuts from the Bank of Canada. The central bank already initiated a dovish pivot earlier this year, delivering a 25-basis-point cut, and the latest data may pave the way for further easing in the second half of 2025.

This diverging monetary policy outlook between the Federal Reserve — which remains cautious about inflation and has kept rates on hold — and the BoC is adding another layer of upward momentum to USD/CAD.

Technical Analysis

From a technical perspective, USD/CAD remains well supported within a short-term bullish correction wave. The pair has consistently traded above its 50-period exponential moving average (EMA50), indicating sustained upward momentum. After breaching the key resistance zone at 1.3760, the price is attempting to establish new ground in the 1.38 handle.

The Relative Strength Index (RSI) is showing positive signals, further strengthening the bullish case — though it is now nearing overbought territory. While this suggests a potential pullback or consolidation phase in the near term, the broader trend remains upward unless key support levels, such as 1.3700, are breached.

A successful hold above 1.3760 would open the door for a potential run toward 1.4000, especially if geopolitical tensions persist and Canadian macro data continues to underwhelm.

TRADE RECOMMENDATION

BUY USDCAD

ENTRY PRICE: 1.3750

STOP LOSS: 1.3670

TAKE PROFIT: 1.4000

Risk Warnings and Disclaimers

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Eva Chen

Economic

Forex

Summary:

PMI data hint at undercurrents in the UK's future prospects. The possibility of the Bank of England's rate cut in August is opening up.

SELL GBPUSD

Close Time

CLOSED

1.34205

Entry Price

1.32780

1.35900

1.33443 +0.00131 +0.10%

169.5

Pips

Loss

1.32780

1.35902

Exit Price

1.34205

Entry Price

1.35900

Fundamentals

A survey released on Monday showed that UK business activity expanded modestly in June, with new orders growing for the first time this year. However, the pace of job cuts by employers accelerated, and there was concern over the Middle East conflict.

The S&P Global UK Composite PMI, which measures the private sector economy, rose from 50.3 in May to 50.7, slightly above the 50.0 threshold for expansion. The dominant service sector in the UK economy achieved its fastest growth in three months. Factory activity declined for the ninth consecutive month, but this was the smallest contraction since January.

S&P stated that the report is in line with an economic growth rate of approximately 0.1% during the period from April to June, which also matches the Bank of England's estimate of the current basic pace of economic expansion. Additionally, S&P indicated that the employment, new export business, and future output indices of the Composite PMI in June deteriorated, with the latter being affected by "increasing global economic and political uncertainty."

Market Observations: The UK economy remains sluggish at the end of the second quarter. Although the business environment has been improving continuously since the recession in April, alleviating concerns over a recession, the growth of business activity remains disappointingly stagnant, indicating a quarterly GDP growth rate of only 0.1% in the second quarter. Compared to last year, business confidence remains low and declined again in June.

Apart from concerns over the impact of recent government policies and global trade protectionism, the data collection in June coincided with the escalation of tensions in the Middle East. With companies grappling with higher labor costs resulting from the budget last autumn, lower demand, and subdued confidence, job losses continued.

However, these circumstances have led to a significant cooling of inflationary pressures, especially in the service sector, which has been a major concern for the Bank of England. Thus, the near-stagnant growth, declining employment, and lower inflation have opened the door for the Bank of England to cut rates again at its next policy meeting in August.

Lackluster Economic Recovery, Rising August Rate Cut Expectations, and Short-term Downside Pressure on the Market_1

Technical Analysis

The intraday trend of GBPUSD currently remains neutrally downward. As long as the resistance level at 1.3592 holds, the risks will remain mildly to the downside. A break below 1.3370 will extend the corrective decline, reaching the 38.2% retracement of the 1.2076 to 1.3631 range, ultimately falling to 1.3278.

Trading Recommendations

Trading Direction: Sell

Entry Price: 1.3440

Target Price: 1.3278

Stop Loss: 1.3590

Valid Until: July 8, 2025, 23:55:00

Support: 1.3370/1.3334/1.3305

Resistance: 1.3448/1.3511/1.3579

Risk Warnings and Disclaimers

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Eva Chen

Commodity

Political

Summary:

Safe-haven assets retreat, unresponsive to geopolitical tensions.

SELL XAUUSD

Close Time

CLOSED

3380.39

Entry Price

3231.00

3425.00

4216.79 +18.88 +0.45%

560.0

Pips

Profit

3231.00

3324.39

Exit Price

3380.39

Entry Price

3425.00

Fundamentals

Amidst the market's close watch on the evolving situation in the Middle East, gold gapped up at the open on Monday, reaching a peak of 3398 USD.

The US's intervention in the Iran-Israel conflict over the weekend has intensified concerns over potential retaliatory actions from Iran. Of particular concern is the possible disruption of the primary oil supply routes in the Middle East.

According to Iranian official media, the Iranian parliament supported a proposal to close the Strait on Sunday. However, the ultimate decision-making power lies with the Supreme National Security Council and Iran's Supreme Leader.

Iran, being one of the world's largest oil producers and exporters, controls the Strait of Hormuz, a crucial maritime energy corridor through which 20% to 30% of the world's oil is transported. Should Iran choose to close the Strait, the global market would likely struggle to cope with the consequences.

Since the US attack on Iranian nuclear facilities over the weekend, gold has, against the norm, failed to rally on the back of safe-haven demand. The market's response to the attack has been lukewarm, seemingly awaiting Iran's next move.

As investors await Iran's response to the US airstrike, the risk of further escalation of geopolitical tensions in the Middle East continues to weigh on investor sentiment. The uncertainty also provides support to the safe-haven gold price and helps to limit its downside potential. Given our consistent bearish stance on gold prices for June, it is prudent to wait for a strong follow-up sell-off before preparing for a continued decline in gold prices from their near two-month highs.

This week, market participants will also be keeping a close eye on speeches from Federal Reserve officials, including Chairman Powell, who will testify at a two-day congressional hearing. The discussions are expected to cover the economic impacts of Trump's trade tariffs and the US military strikes on Iran.

Key macroeconomic data to watch include the core inflation rate (excluding food and energy), initial jobless claims, and the PMI Business Activity Index. These reports could influence the Fed's next policy moves and also offer more trading opportunities for investors.

Bearish Outlook on Gold for June Despite Escalating Geopolitical Tensions_1

Technical Analysis

From a technical standpoint, gold's gap up at the open during the Sydney session on Monday did not lead to an effective upward structure. Given that the oscillators on the daily chart are losing positive momentum, gold prices may be showing signs of a short-term peak.

Based on the fact that gold prices typically exhibit negative momentum in June, we continue to adhere to a strategy of selling on rallies.

Trading Recommendations

Trading Direction: Sell

Entry Price: 3387

Target Price: 3231

Stop Loss: 3425

Valid Until: July 8, 2025, 23:55:00

Support: 3360/3346/3338

Resistance: 3388/3400/3403

Risk Warnings and Disclaimers

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Alan

Commodity

Summary:

The ongoing escalation of the Middle East geopolitical crisis, marked by U.S. airstrikes on Iran and the Iranian parliament's vote to close the Strait of Hormuz, is expected to sustain upward pressure on crude oil prices.

BUY WTI

Close Time

CLOSED

73.966

Entry Price

77.900

71.900

59.984 +0.175 +0.29%

206.6

Pips

Loss

71.900

71.895

Exit Price

73.966

Entry Price

77.900

Fundamentals

The core geopolitical tension in current WTI crude oil pricing centers on the escalation of risks in the Strait of Hormuz. The sudden deterioration of Middle Eastern stability has triggered a panic-driven repricing of oil supply risks: last weekend's U.S. military strikes on Iranian nuclear facilities and the Iranian parliament's vote on closing the Strait of Hormuz have collectively threatened approximately one-third of global maritime crude oil trade with potential disruption. This geopolitical risk premium caused WTI futures to open sharply higher today, but subsequent market reassessment, viewing the likelihood of Iran closing the strait as low, led to a retreat, with WTI erasing its early gains and maintaining a downward trend through the European trading session.

In response to U.S. airstrikes targeting Iran's nuclear infrastructure, Iran's Supreme Leader Ayatollah Khamenei's senior advisor, Ali Shamhani, posted on social media that even if Iran's nuclear facilities are destroyed, the conflict is far from over; uranium enrichment capabilities, technical expertise, and political resolve remain intact.

Meanwhile, Khosravi, a member of Iran's Parliamentary National Security Committee, stated that the parliament has concluded that closing the Strait of Hormuz should be considered, though the final decision rests with Iran's Supreme National Security Council. Market analysts warn that if Iran proceeds with closing the strait, crude oil prices could surge to US$120 per barrel.

Technical Analysis

Conflict Ignites the Oil Market's Core, with Bullish Trends Continuing Unabated_1

In the 4H timeframe, WTI crude oil opened sharply higher today, gaining nearly US$3 to reach US$76.66 before quickly retracing its gains, effectively erasing the entire intraday rally and maintaining a downward correction trend. However, the SMA system remains in a bullish alignment, indicating that the upward momentum for WTI crude oil has not yet reversed, suggesting a higher probability of continued short-term gains.

Currently, WTI crude oil has retreated to the Fibonacci retracement level of 0.236 at US$72.59, which also coincides with the MA20, creating a support resonance. This enhances the likelihood of WTI maintaining its bullish trend. If the price fails to effectively break below US$72.59 and the MA20 in the near term, the short-term outlook remains bullish; otherwise, WTI may test the key support level at US$71.13.

It is recommended to go long at the lows.

Trading Recommendations

Trading Direction: Buy

Entry Price: 73.70

Target Price: 77.90

Stop Loss: 71.90

Valid Until: July 7, 2025 23:00:00

Support: 72.78, 72.06

Resistance: 76.66, 79.35

Risk Warnings and Disclaimers

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Manuel

Central Bank

Economic

Summary:

This pattern could indicate that bullish momentum is waning, potentially opening the door for bears to regain control.

SELL USDCHF

Close Time

CLOSED

0.81636

Entry Price

0.80600

0.82150

0.80291 -0.00164 -0.20%

27.8

Pips

Profit

0.80600

0.81358

Exit Price

0.81636

Entry Price

0.82150

Rising concerns about possible U.S. involvement in the Middle East conflict have intensified demand for the Swiss franc (CHF), a well-known safe haven currency during times of geopolitical tension.

The ongoing conflict between Israel and Iran has now entered its seventh day. The White House recently stated that U.S. President Donald Trump will decide within the next two weeks whether to formally support Israel in the conflict. The uncertainty surrounding the potential escalation of war in the Middle East, combined with the risk of direct U.S. involvement, is amplifying risk-off sentiment and driving capital into safe-haven assets like the Swiss franc.

On Thursday, the Swiss National Bank (SNB) surprised the markets by cutting its policy rate by 25 basis points—from 0.25% to 0.00%—during its June meeting. Moreover, the central bank did not rule out a return to negative interest rates in the near future. The rate cut immediately strengthened the Swiss franc against the U.S. dollar.

Charlotte de Montpellier, economist at ING Bank, commented: “Unless there is a significant shift in conditions between now and September, today’s decision paves the way for another rate cut in September and a potential return to negative interest rates.”

However, the SNB also offered a relatively hawkish outlook, suggesting it does not currently plan further cuts in the short term. This stance disappointed some market participants who had anticipated a quicker move into negative territory.

Meanwhile, the U.S. Federal Reserve struck a notably more hawkish tone, offering support to the U.S. dollar. The Fed left interest rates unchanged on Wednesday and reaffirmed its forecast of two rate cuts in 2025. However, Fed Chair Jerome Powell downplayed those projections, citing rising inflationary pressures linked to newly imposed tariffs by the Trump administration. His comments cast doubt on a potential rate hike in September that many investors had priced in.

The Fed’s latest monetary policy report acknowledged that there are early signs tariffs may be contributing to upward pressure on inflation. Still, the full impact has yet to be fully reflected in economic data. The report also emphasized that current policy remains appropriate and that financial stability is holding up well despite heightened uncertainty.

This contrasts with the remarks made by Fed Governor Christopher Waller, who recently said the Fed could begin cutting rates as early as July, highlighting internal divisions within the central bank’s policy outlook.

In terms of U.S. data, the latest reports painted a mixed picture for the dollar. The Philadelphia Fed Manufacturing Index came in flat at -4.0 in June, matching May’s reading and falling short of expectations for modest improvement. The stagnation signals that regional manufacturing activity remains weak, weighed down by soft demand and the first signs of cooling in the labor market. Of particular concern, the employment subindex fell back into negative territory for the first time since May 2020, indicating renewed contraction in manufacturing jobs. Fresh Bearish Momentum May Build from Resistance Zone_1

Fresh Bearish Momentum May Build from Resistance Zone_1

Technical Analysis

USD/CHF is currently encountering strong resistance near its 100- and 200-period moving averages, located at 0.8159 and 0.8186, respectively, on the 4-hour chart. These zones have repeatedly acted as a ceiling, from which price has previously reversed to the downside. Should this pattern continue, a renewed decline toward the local low around 0.8051—last visited on June 12—remains a likely scenario.

Additionally, the Relative Strength Index (RSI) peaked at 70.45 on June 18, entering overbought territory. Since then, it has failed to form a new high, and bearish candles have emerged from the vicinity of the 200-period moving average. This pattern could indicate that bullish momentum is waning, potentially opening the door for bears to regain control.

A decisive close below the 100-period moving average may accelerate downside momentum, especially if geopolitical tensions continue to dominate market sentiment and boost demand for the Swiss franc. Conversely, a strong breakout above the local high at 0.8212 could signal a resumption of the bullish trend, challenging the current bearish narrative.

Trading Recommendations

Trading direction: Sell

Entry price: 0.8165

Target price: 0.8060

Stop loss: 0.8215

Validity: Jun 30, 2025 15:00:00

Risk Warnings and Disclaimers

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