As North American trading gets underway on Thursday, markets are grappling with a familiar but critical question: are we moving toward a sustained cease-fire and de-escalation, or is this just a pause before tensions ramp back up? Right now, the answer is anything but clear—and that uncertainty is driving price action across all asset classes.
There remains confusion around the scope of the cease-fire, particularly whether Lebanon is included. That matters. Iran’s backing of Hezbollah ties the region directly into the broader conflict, and with Israel continuing military operations in Lebanon, traders are left questioning how durable any “cease-fire” really is. In many ways, Tuesday’s announcement felt more like a “kick-the-can” moment—a temporary pause designed to buy time, keep negotiations alive, and potentially reopen the Strait of Hormuz—rather than a firm step toward lasting peace.
That said, diplomacy is still in motion. Delegations from Iran and the U.S. are expected to meet in Pakistan tomorrow, which could be a key inflection point. But until there is clarity—and more importantly, follow-through—markets will remain highly reactive to every headline.
At the core of it all is oil and access through the Strait of Hormuz. That remains the heartbeat of this story. After plunging 16–17% on hopes of de-escalation earlier in the week, crude has bounced back sharply. Prices are now higher by roughly 4–5%, with spot crude near $98.85 and the June contract around $90.93. While still below the psychological $100 level, it’s worth remembering that pre-conflict prices were sitting in the low $60s. That’s a massive repricing of geopolitical risk—and it’s not going away anytime soon.
Risk markets are reflecting the renewed uncertainty. U.S. equity futures are lower, with the Dow down around 150 points, the S&P off roughly 17 points, and the Nasdaq slipping modestly. At the same time, the bond market is showing a slight bid, with yields edging lower—the 2-year down 2 basis points to 3.77% and the 10-year off 1 basis point near 4.28%. That suggests a mild tilt toward safety, but not panic.
In the forex market, the USD is mixed and searching for direction. It’s modestly stronger against the JPY (up ~0.2%), reflecting some safe-haven demand, but softer versus the EUR and GBP (both down ~0.2%). Yesterday’s sharp dollar selloff has been followed by corrective price action, muddying the short-term picture and leaving traders focused on the next catalyst.
In the video above, I break down the three major currency pairs—EURUSD, USDJPY, and GBPUSD—from a technical perspective. I outline where the key moving averages, swing levels, and retracement zones come into play
