Gold stays under bearish pressure and trades near $4,800 after having touched its highest level in a week above $4,870 earlier in the day. Given that the path to a durable US-Iran agreement remains uncertain on the back of the instability in the Strait of Hormuz, the US Dollar stages a modest recovery from its lowest level since early March and undermines the commodity.
Gold retreats further from four-week top amid modest USD recovery; downside seems limited
Gold (XAU/USD) extends its intraday retracement slide from a nearly four-week high, touched during the Asian session earlier this Wednesday, and touches a fresh daily low, around the $4,815 region in the last hour. Given that the path to a durable US-Iran agreement remains uncertain on the back of the instability in the Strait of Hormuz, the US Dollar (USD) stages a modest recovery from its lowest level since early March and undermines the commodity. In fact, Iran’s ambassador to the UN described the US blockade, which took effect on Monday, as a grave violation of Tehran’s sovereignty.
Moreover, Iran’s Islamic Revolutionary Guard Corps (IRGC) has vowed to retaliate, keeping geopolitical risks in play. This, in turn, benefits the USD’s reserve currency status and exerts some downward pressure on the Gold price. Investors, however, remain hopeful that the door for Iran diplomacy remains open. Furthermore, diminishing odds for a rate hike by the US Federal Reserve (Fed) should keep a lid on any meaningful USD recovery. This, in turn, could offer some support to the non-yielding yellow metal and help limit deeper losses, warranting some caution for aggressive bearish traders.
US Vice President JD Vance, speaking at a public event, again struck a cautiously optimistic tone and said that Washington is pursuing a broader grand bargain aimed at reshaping Iran’s economic integration with the world. Furthermore, United Nations (UN) Secretary-General António Guterres told reporters on Tuesday that the resumption of US-Iran talks is highly probable. The optimism over diplomatic efforts to extend the US-Iran ceasefire has been a key factor behind the recent USD decline to its lowest level since early March, and continues to underpin the Gold.
Meanwhile, data released on Tuesday showed that the US Producer Price Index (PPI) rose to 4% on a yearly basis in March from 3.4% in the previous month. On a monthly basis, the PPI climbed 0.5%, while the gauge excluding Food & Energy was up 3.8% YoY in March. These readings fell short of consensus estimates and eased concerns about the inflationary impact of the war-driven surge in energy prices, tempering hawkish expectations. The resultant decline in US Treasury bond yields should contribute to capping the USD and back the case for the emergence of dip-buyers around the Gold.
XAU/USD 4-hour chart
Gold bulls turn cautious after failing to find acceptance above 200-period SMA on H4
The XAU/USD pair is holding a constructive bullish bias and looking to build on momentum beyond the 200-period Simple Moving Average (SMA) pivotal resistance on the 4-hour chart. Meanwhile, momentum remains strong, with the Relative Strength Index (RSI) at 65.5, edging toward overbought territory, and the Moving Average Convergence Divergence (MACD) rising in positive territory. This hints that bullish pressure persists but may be vulnerable to fatigue on further gains.
In the meantime, initial resistance is seen at the 61.8% Fibonacci retracement level at $4,912.54, and a sustained break above this level would open the way toward the 78.6% retracement at $5,134.37, ahead of the cycle high at $5,416.94. On the downside, the 50% retracement level of the March downfall reinforces the underlying floor at $4,756.73. A convincing break below this would expose deeper supports at the 38.2% retracement level at $4,600.92 and the 23.6% level at $4,408.14, where buyers would be expected to regroup on a more pronounced correction.
(The technical analysis of this story was written with the help of an AI tool.)
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.06% | -0.00% | 0.13% | 0.05% | -0.17% | 0.01% | 0.03% | |
| EUR | -0.06% | -0.07% | 0.07% | 0.02% | -0.15% | -0.05% | -0.01% | |
| GBP | 0.00% | 0.07% | 0.15% | 0.11% | -0.08% | -0.01% | 0.05% | |
| JPY | -0.13% | -0.07% | -0.15% | -0.07% | -0.22% | -0.14% | -0.09% | |
| CAD | -0.05% | -0.02% | -0.11% | 0.07% | -0.14% | -0.05% | -0.02% | |
| AUD | 0.17% | 0.15% | 0.08% | 0.22% | 0.14% | 0.10% | 0.14% | |
| NZD | -0.01% | 0.05% | 0.00% | 0.14% | 0.05% | -0.10% | 0.04% | |
| CHF | -0.03% | 0.01% | -0.05% | 0.09% | 0.02% | -0.14% | -0.04% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Japan Machinery Orders (YoY) registered at 24.7% above expectations (8.5%) in February
Ethereum briefly recovered the $2,400 level on Tuesday, its highest level since February 1, following the latest developments in peace talks between the US and Iran. The US military blockade of the Strait of Hormuz and reports of a new round of negotiations in the coming days have lifted risk sentiment.
Gold surges as Iran talks hopes dent US Dollar again
Gold (XAU/USD) price surges nearly 2% on Tuesday amid growing optimism linked to the resumption of US-Iran talks, even though the US military seized Iran-linked ships as the blockade of the Strait of Hormuz persists. The XAU/USD trades at $4,835 after bouncing off daily lows of $4,742.
Bullion rallies as softer Oil and Dollar lift haven demand
Geopolitical news continued to drive the markets, with US President Donald Trump grabbing the headlines and hinting at a possible meeting between Washington and Tehran this week. He told the New York Post, “You should stay there, really, because something could be happening over the next two days, and we’re more inclined to go there.”
The Greenback remains on the back foot due to its safe-haven appeal. The markets are pricing in a possible de-escalation of the conflict, as the buck has fallen to a six-week low at 97.96, according to the US Dollar Index (DXY). In the session, the DXY is down 0.26%, also dragged down by Oil prices.
Western Texas Intermediate (WTI), the US crude oil benchmark and a dollar-denominated asset, tanks nearly 6.40% to $91.72 per barrel. The positive correlation between WTI and the DXY, along with the improvement in risk appetite, is the catalyst behind the rise in bullion prices.
The US economic docket featured Federal Reserve (Fed) speakers, jobs, and inflation data. Regarding the US central bank, Chicago Fed President Austan Goolsbee said they might hold rates steady this year and look for rate cuts in 2027 if energy prices remain high due to the Iran war.
The Federal Reserve may need to wait until 2027 to cut interest rates if an extended bout of high Oil prices from the Iran war delays inflation’s progress towards the US central bank’s 2% goal, Goolsbee said.
Governor Stephen Miran said on Monday that he expects inflation to be closer to target in a year, adding that he sees no reason for oil prices to remain elevated.
Inflationary fears have pushed investors to trim their bets on the Fed’s dovish stance, and now money markets are speculating that the Federal Reserve will keep interest rates steady throughout the year, according to Prime Market Terminal (PMT).
Fed interest rate probabilities
On the data front, the US PPI figures undershot forecasts in March, with headline inflation rising 4% YoY, below the expected 4.6%, while core PPI remained unchanged from February’s at 3.8% YoY.
Meanwhile, the ADP four-week average climbed to 39.25K from 26K, reinforcing the narrative of a still-resilient labor market.
Traders’ eyes will be on developments in the Middle East conflict. Data-wise, the US economic docket will feature speeches by Fed officials, the release of the Fed Beige Book, and Initial Jobless Claims data on Thursday.
XAU/USD technical outlook: Gold rally, on its way towards $4,900
Gold’s uptrend accelerated past the $4,800 mark with traders facing strong resistance at $4,857, the April 8 daily high, followed by the 50-day Simple Moving Average (SMA) at $4,896.
Price action suggests that Gold is trading at four-day highs, an indication that buyers are gaining traction, as confirmed by the Relative Strength Index (RSI), which turned bullish two days ago.
If XAU/USD extends its gains past $4,900, the $5,000 milestone is up for grabs. Otherwise, if bullion tumbles below the $4,800 mark, a potential move to the confluence of the 100- and 20-day SMAs, each at $ 4,677 and $ 4,650, is possible.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
GBP/USD: Upside bias with limited resistance – Scotiabank
Scotiabank notes the Pound is up 0.3% versus the Dollar, trading at pre‑conflict highs as investors welcome strong demand for UK debt. Domestic data risk is light before trade and industrial production, while BoE speakers, including Gov. Bailey, pose event risk. Technically, GBP/USD shows bullish RSI, with support below 1.3450 and scope toward mid‑February highs near 1.37.
Pound supported by issuance demand and BoE risk
“The pound is also entering Wednesday’s NA session with a 0.3% gain and extending its latest recovery to fresh local highs at levels that last prevailed ahead of the US/Iran conflict.”
“Domestically, market participants are cheering strong demand for UK debt issuance, with sizeable orders for both Treasury offerings and those of large financial institutions.”
“Data risk remains limited ahead of Thursday’s trade and industrial production figures, while BoE risk has returned with comments from the MPC’s Mann—stressing a need to ‘be active’ whether ‘that means [a] big rise or cut or long hold’.”
“Bullish—the RSI is now firmly in bullish territory and pushing above 60, as spot extends its recovery to fresh local highs above 1.35.”
“We see limited resistance between current levels and the mid-Feb peaks around 1.37 and now look to support below 1.3450.”
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Gold Price Forecast: XAU/USD bulls will find resistance at the $4,850 area
Gold (XAU/USD) is showing a moderate bullish tone for the second consecutive day on Tuesday, with price action approaching the $4,800 level after bouncing from one-week lows at $4,664 on Monday. Speculation about a new round of negotiations between the US and Iran is allowing a moderate risk aversion, which is buoying precious metals against the safe-haven US Dollar.
News reports hint at ongoing contacts between the US and Iran. Reuters affirmed earlier on Tuesday that delegations from both countries might be ready to resume peace negotiations in Pakistan this week, while US President Donald Trump assured on Monday that Iran had called asking to “work for a deal”. On Tuesday, US Vice President JD Vance said that it is up to Tehran to “take the next step·” in peace negotiations.
Technical Analysis: Looking for direction between $4,620 and $4,850
From a wider perspective, XAU/USD continues trading within a horizontal range with resistance at the $4,850 area holding bulls, with downside attempts limited by the 38.6% Fiboonacci retrecement of the March sell-off, around $4,620
Relative Strength Index (RSI) in the 4-hour chart has popped up above the 50 midline, but remains capped below 60. The Moving Average Convergence Divergence (MACD) keeps hovering around the zero line, showing a lack of clear momentum.
Bulls should break the mentioned $4,850 resistance area (April 8 high) to resume the near-term bullish trend towards the 61.8 Fibonacci level, at $4,932, and a previous support turned resistance right above $5,000.
On the downside, a slide back through the $4,620 area would negate the bullish structure and expose March 26 lows at the $4,350 area.
(The technical analysis of this story was written with the help of an AI tool.)
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Oil: Supply shock risks with Hormuz crisis – Rabobank
Rabobank strategists highlight that Brent Oil prices are down on screens even as the US blockade of Hormuz, combined with Iran’s actions, threatens prolonged disruption. They warn that refinery feedstock is running out, airlines like Qantas are cutting flights, and policymakers are loosening energy taxes into a supply shock that could fuel inflation.
Hormuz blockade and refinery disruptions
“Yes, a once-unthinkable US blockade of Hormuz is now in place, extending into the Gulf of Oman and the Arabian Sea, on top of the pre-existing Iranian blockade – and Trump has underlined he will sink any Iranian ships trying to break it. Two tankers have already turned away, according to tracker data.”
“Yes, Iran is threatening Gulf ports, saying none would be safe if its own aren’t; Russia is withdrawing almost all its remaining staff from Iran’s Bushehr nuclear plant; US minesweepers maybe heading towards the Middle East, pointing to a demining process that could keep Hormuz closed for weeks yet; and even the US energy secretary just warned that oil prices are likely to rise until ‘meaningful’ traffic resumes through the Strait.”
“That contrasts with the nothing many global oil refineries will have flowing through them shortly now the last tankers enroute before the war have arrived, pointing to looming shortages of key fuels in places. For example, in Australia, Qantas is now cutting domestic flights.
“However, equally notably, the general global fiscal trend is towards loosening, at least in terms of energy taxes, to try to smooth over a supply shock, which every economic textbook underlines ends badly – first, if everyone does the same, not just some, and second if this Hormuz crisis drags on.
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
EUR/USD climbs to 1.1765-1.1770, highest since March as Iran diplomacy hopes undermine USD
The EUR/USD pair is seen building on the previous day’s strong intraday move up of over 100 pips and gaining some follow-through traction during the Asian session on Tuesday. This marks the eighth straight day of a positive move and lifts spot prices to a fresh high since early March, around the 1.1765-1.1770 region in the last hour.
Despite failed peace talks over the weekend, investors continue to move towards riskier assets amid hopes that the door for Iran diplomacy remains open. In fact, US Vice President JD Vance struck a cautiously optimistic tone on negotiations with Iran and suggested that meaningful progress has been made even as talks have yet to deliver a breakthrough. This, in turn, undermines the US Dollar’s (USD) reserve currency status and acts as a tailwind for the EUR/USD pair.
Apart from this, the uncertainty over future interest rate moves by the US Federal Reserve (Fed) keeps the USD depressed near its lowest level since early March. That said, the instability surrounding shipping traffic from the Strait of Hormuz might keep a lid on the optimism and limit deeper USD losses. US President Donald Trump said that the U.S. Navy blockade of the strategic waterway has officially started and vowed to destroy Iranian warships that get near the blockade.
Iran responded with threats on all ports in the Persian Gulf and the Gulf of Oman, keeping geopolitical risks in play. Adding to this, fears that the ceasefire that is currently holding could collapse, and that the war could resume, might lend some support to the USD and hold back traders from placing aggressive bullish bets around the EUR/USD pair. The fundamental backdrop, however, backs the case for an extension of the pair’s recent uptrend from the late March swing low.
Euro FAQs
The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day.
EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy.
The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control.
Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency.
A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall.
Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
EUR/USD extends gains as Dollar slides to fresh six-week lows now
EUR/USD extended its gains on Monday as market mood improved, weighing on the US Dollar, which fell to six-week lows near 98.36 according to the US Dollar Index (DXY). At the time of writing, the pair trades at 1.1757, up 0.32%.
Euro draws support from firmer sentiment and renewed truce hopes
Sentiment has improved, and is a tailwind for the single currency, which seems poised to test the 1.1800 figure in the near term. The two-week ceasefire seems fragile, as the US and Iran could return to negotiations following a not-so-productive meeting last Saturday.
Negotiations in Pakistan lasted 21 hours, and despite achieving some progress, Iran was reluctant to abandon its nuclear program and control of the Strait of Hormuz. The White House retaliated by imposing a blockade in the Strait of Hormuz, as tensions escalated between the two sides.
Recently, the US President Donald Trump said that Tehran wants to make a deal, as a report by the New York Post suggested that Iran was studying halting the Uranium enrichment program, as a US condition for ending the war.
The EUR/USD jumped after the news, while the US dollar weakened to a six-week low, according to the US Dollar Index (DXY). The DXY, which tracks the performance of the buck’s value against six currencies, is down 0.29% at 98.36.
Data in the US has taken the driver’s seat, unless it’s inflation-related. Existing Home Sales fell to a nine-month low of 3.98 million in March, down 3.6% MoM.
Across the pond, elections in Hungary are also driving the Euro higher, as the winner, Peter Magyar, promised to restore democratic standards in the country following a landslide victory over the outgoing Prime Minister Viktor Orban, who had been in power for 16 years.
The Vice President of the European Central Bank (ECB), Luis de Guindos, said the impact of the conflict in the Middle East will depend on its duration. ECB’s Vujcic commented that energy prices remain within the ECB’s baseline scenario.
Traders’ eyes will be on the Producer Price Index (PPI) for March, along with the ADP Employment Change 4-week average and a slew of Fed speakers. In Europe, speeches by ECB’s Chief Economist Philip Lane —twice — and Mario Cipollone would cross the wires.
EUR/USD Price Analysis: Technical outlook
In the daily chart, EUR/USD trades at 1.1758. The pair holds above the triple simple moving average cluster at 1.1674, keeping the near-term bias tilted to the upside as recent price action rides an ascending sequence of higher closes. The Relative Strength Index (14) at 62.6 leans toward bullish but not yet overbought territory, suggesting buyers retain control while leaving room for further gains before conditions turn stretched.
On the downside, initial support is found at the 1.17 area, reinforced by the 50/100/200-day simple moving averages converging around 1.1674. A deeper pullback would expose former resistance-turned-support near 1.1536, ahead of stronger structural backing around 1.1488, where the prior rising trend line was broken.
(The technical analysis of this story was written with the help of an AI tool.)
Euro FAQs
The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day.
EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy.
The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control.
Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency.
A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall.
Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
Dow Jones Industrial Average edges lower as Goldman drags, Crude Oil climbs back over $100
The Dow Jones Industrial Average (DJIA) edged lower on Monday, slipping around 50 points to trade near 47,900 after recovering from a much steeper drop at the open. The S&P 500 rose 0.2% to trade above 6,800, while the Nasdaq Composite gained 0.6% to push above 23,000. Dow Jones Industrial Average futures had plunged more than 500 points in the overnight session after President Trump announced a US blockade of the Strait of Hormuz, but equities staged a notable intraday recovery as investors appeared to bet on an eventual resolution to the US-Iran standoff.
Hormuz blockade sends Oil back above $100
West Texas Intermediate (WTI) Crude Oil surged more than 5% to top $101 per barrel after Trump declared that the US Navy would blockade all vessels entering or leaving Iranian ports in the Strait of Hormuz. US Central Command (CENTCOM) clarified that the blockade would not impede vessels transiting the strait to non-Iranian ports. The announcement came after weekend negotiations in Islamabad collapsed, with Vice President JD Vance departing without a deal, citing Iran’s unwillingness to halt its nuclear weapons program. The two sides appear far apart, with Iran also demanding control of the strait, war reparations, and the release of frozen assets. Mediators from Pakistan, Egypt, and Turkey will continue talks with both nations in the coming days, according to Axios. Meanwhile, the Wall Street Journal reported that Trump is weighing a resumption of military strikes. Brent Crude jumped as much as 9% to trade near $102. The move reverses much of the relief rally that followed the April 7 ceasefire agreement, which had briefly pushed Oil prices back below $100. “Investors are now back to the drawing board trying to reassess the fair value of stocks now that it’s clear that there is no end in sight to the conflict in the Middle East,” said Clark Bellin, president and chief investment officer at Bellwether Wealth.
Goldman Sachs weighs on the Dow
Goldman Sachs (GS) was the biggest drag on the Dow Jones Industrial Average on Monday, falling 2.5% despite reporting first-quarter results that topped estimates on both the top and bottom line. Earnings per share came in at $17.55 versus the $16.49 consensus estimate, while revenue hit $17.23 billion against expectations of $16.97 billion. The standout was equities trading, which posted a record quarter at $5.33 billion in revenue, up 27% YoY. However, the bank’s fixed income, currencies and commodities (FICC) division was a sore spot, with revenue dropping 10% YoY to $4.01 billion, missing StreetAccount estimates by roughly $900 million. The miss was attributed to weakness in interest rate products, mortgages, and credit. Bank of America called the overall results “solid” but “clouded by the FICC miss,” while Wolfe Research described the quarter as “disappointing” despite lofty expectations, noting that higher commodities and foreign exchange trading were more than offset by weakness in rates, mortgages, and credit. Wells Fargo added that the FICC shortfall was “a little surprising relative to peer guidance and balance sheet growth.” The result kicked off what is expected to be a busy week for bank earnings, with JPMorgan Chase, Citigroup, Wells Fargo, Morgan Stanley, and Bank of America all set to report.
Software stocks lead the recovery
While financials dragged, technology and enterprise software names pushed the Nasdaq Composite higher. Oracle (ORCL) surged 8% to lead S&P 500 gainers after announcing new AI-powered utilities industry suite offerings. Palantir Technologies (PLTR) gained more than 3%, while ServiceNow (NOW) and Workday (WDAY) both rose more than 5%. Within the Dow, Salesforce (CRM) rose more than 3% on optimism around its artificial intelligence integration pipeline, Microsoft (MSFT) added around 1.6%, and IBM (IBM) gained roughly 1%. The sector rotation out of financials and into software was a defining feature of the session, helping the Nasdaq outperform despite the heavy geopolitical overhang. Semiconductor stocks broadly held gains from last week’s rally, which had been fueled by strong results from TSMC and renewed AI capex commitments from major tech firms.
Existing home sales hit nine-month low
Existing home sales fell to a seasonally adjusted annual rate of 3.98 million in March, the National Association of Realtors (NAR) reported Monday. The figure marked a 3.6% monthly decline and missed the Dow Jones consensus estimate of 4.05 million, coming in at the lowest level since June 2025. Mortgage rates climbed sharply through March, peaking at 6.64% for a 30-year loan before easing by roughly a quarter percentage point during the US-Iran ceasefire. The median home sales price rose 1.4% YoY to near $409K. The housing data adds to a growing pile of evidence that elevated borrowing costs are weighing on rate-sensitive parts of the economy, keeping pressure on the Federal Reserve (Fed) as it navigates between persistent inflation risks and softening demand.
Bond yields rise as inflation fears return
Treasury yields climbed on Monday as the resurgence in Oil prices reignited inflation concerns. The 10-year Treasury yield rose 3 basis points to 4.34%, while the 30-year yield added 2 basis points to reach 4.93%. The moves come on the back of Friday’s Consumer Price Index (CPI) data, which had already revived higher inflation expectations. With Oil back above $100, traders are increasingly pricing in the possibility that the Fed may need to delay rate cuts further. The bond selloff adds another layer of pressure for equity valuations, particularly in rate-sensitive sectors. Last week had been the strongest for all three major indexes since November, with the S&P 500 gaining 3.6%, the Nasdaq jumping 4.7%, and the Dow advancing 3%, so Monday’s relatively contained pullback was viewed as a healthy pause given the escalation in geopolitical risk.
Looking ahead
The key data release this week is the March Producer Price Index (PPI) inflation update due on Tuesday, with consensus expecting a jump to 4.6% YoY from 3.4% previously, and 1.2% MoM versus 0.7% prior. Core PPI excluding food and energy is also expected to accelerate to 4.2% YoY from 3.9%. A hot PPI print, particularly on the heels of Friday’s CPI data and the renewed surge in Oil prices, could further dampen rate cut expectations and weigh on risk sentiment. Thursday brings weekly Initial Jobless Claims (consensus 215K), the Philadelphia Fed Manufacturing Survey, and March Industrial Production data. The week also features a heavy lineup of Fed speakers, including Goolsbee, Barr, Barkin, Collins, and Williams, along with the release of the Fed’s Beige Book on Wednesday.
Dow Jones 5-minute chart
Dow Jones FAQs
The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500.
Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.
Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits.
There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.