For the US dollar, the current week could be a failure or quite positive. All the most important events will once again be related to the US, and all critical reports will come from the US. Let's start with geopolitics. On Monday, it became known that the situation in the Strait of Hormuz is heating up again. Iran launched two missile strikes on an American warship that was trying to pass through the Strait of Hormuz. According to reports from Iran, a warning signal was sent to the ship, which was ignored. After that, Tehran fired two missiles at the destroyer. At this point, it is unclear whether the ship was sunk, as Iran reported hitting the target, while Washington claimed the ship remained intact. Frankly, I tend to believe Tehran, but it is certainly better to believe Washington.

If Tehran has indeed sunk the American destroyer, this means that missile strikes on Iran are likely to resume in the near future. If the American ship is intact, there is hope for continuing negotiations, though they may be highly ineffective. In any case, this week we will see significant geopolitical news, and the market will react to at least some of it, as it did on Monday.

There will also be a considerable number of economic reports. On Tuesday, the ISM services sector activity index and the March JOLTs report on job openings will be released. I don't consider the JOLTs report to be significant, but it is still part of the labor market statistics package, which is crucial for the Federal Reserve. Let me remind you that the FOMC could vote for tightening monetary policy if the labor market recovers to previous levels. However, I wouldn't expect that to happen anytime soon, even if this week's data doesn't disappoint. The recovery of the US labor market will take a long time, just like the recovery of oil flows from the Middle East. At this point, it remains unclear if the US labor market is recovering at all.

On Wednesday, the ADP employment report will be released. However, this report is neither precise nor significant for the market. It is more of a supplementary indicator for Nonfarm Payrolls. And on Friday, we will see what all traders look forward to every month: the unemployment report and Nonfarm Payrolls. This time, the unemployment rate is expected to remain at 4.3%, while the payroll figure is expected to be 60,000. Of course, actual values will differ...

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within the upward segment of the trend (bottom image) and, in the short term, is in a corrective structure. The corrective wave set appears quite complete and may only take on a more complex, elongated form if the geopolitical background in the Middle East does not worsen this week. Otherwise, a new downward segment of the trend may begin from the current positions. We have seen the corrective wave, and I expect further increases in the instrument from current levels, targeting around the 19 figure.

Wave Picture for GBP/USD:

The wave pattern for the GBP/USD instrument has become clearer over time, as I anticipated. Now we see a clear five-wave upward structure on the charts, which may be completed soon. If this is indeed the case, we can expect a corrective wave set to form. Therefore, the base scenario for the coming days is an increase into the 37 figure. Everything else will depend on geopolitical factors.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to forecast and are often subject to change.
2. If there is no confidence in the market, it is better not to enter.
3. There is never 100% certainty in the direction of movement. Always remember to use protective stop-loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

The British pound finds itself in an even better position than the euro. The start of the new week hasn't been ideal, but nothing too alarming has happened yet. Unfortunately, this may be the calm before the storm. At present, it is entirely unclear whether the attack by Iran on an American destroyer actually took place, as Washington denies any damage to its vessel. Meanwhile, an air alert has been declared in Dubai for the first time since the temporary ceasefire. The smoke is increasing without fire. Should a fire break out, demand for US currency may rise further, impacting the current wave pattern of the pound.

Last week, the Bank of England adopted a moderately "hawkish" position, much like the European Central Bank. The British central bank did not raise interest rates, but indicated that such a decision could become feasible at future meetings. The BoE recognizes that inflation is accelerating, and economic growth rates may slow due to potential policy tightening. However, inflation remains the BoE's top priority, so if inflation continues to rise, rates will need to be increased.

And inflation is likely to rise. We have only seen data for the first month of the oil conflict. In April, the Consumer Price Index could spike much higher than the current 3.3%. For the pound, this is also very good news, as the Federal Reserve intends to maintain the status quo throughout 2026. The new director, Kevin Warsh, along with Stephen Miran, may even advocate for a rate cut despite rising inflation. In fact, Miran votes for policy easing at every meeting.

The news background from the UK will be absent this week, making it much easier for the market. Analysis will largely focus on US geopolitical data and information. As I mentioned, the US labor market remains in a rather "cool" state, and it is very difficult to draw clear conclusions from the unemployment and payroll data for the first three months. Therefore, I would not be surprised if the April data turn out to be weak. What would make them strong if inflation in the US is accelerating, expenses are rising, and companies are being forced to cut production and service levels due to fuel shortages or high costs?

Based on all of the above, I believe the euro and the pound will gain this week. The only thing that could prevent the market from buying both instruments would be geopolitics. The situation in the Middle East has not yet flared up with renewed intensity, but it could if it turns out that the American destroyer has been significantly damaged or sunk. Therefore, Trump's next statement could be very important.

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within the upward segment of the trend (bottom image) and, in the short term, is in a corrective structure. The corrective wave set appears quite complete and may only take on a more complex, elongated form if the geopolitical background in the Middle East does not worsen this week. Otherwise, a new downward segment of the trend may begin from the current positions. We have seen the corrective wave, and I expect further increases in the instrument from current levels, targeting around the 19 figure.

Wave Picture for GBP/USD:

The wave pattern for the GBP/USD instrument has become clearer over time, as I anticipated. Now we see a clear five-wave upward structure on the charts, which may be completed soon. If this is indeed the case, we can expect a corrective wave set to form. Therefore, the base scenario for the coming days is an increase into the 37 figure. Everything else will depend on geopolitical factors.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to forecast and are often subject to change.
2. If there is no confidence in the market, it is better not to enter.
3. There is never 100% certainty in the direction of movement. Always remember to use protective stop-loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

The new week for the euro currency has not started particularly well, but the "mess" has not spoiled it. Traders are still aiming to buy due to events from the previous week. To recap, inflation in the European Union continues to accelerate, and with the current progress in the negotiations between Iran and the US, the Strait of Hormuz will likely remain blocked for some time. Consequently, further increases in energy prices can be expected. However, even without this, there is already a global oil shortage, and the Eurozone (along with many other countries) has been forced to turn to strategic reserves. The greater the shortage, the higher oil prices will rise.

Based on this, the European Central Bank may raise interest rates at its next meeting. I must admit, I expected a "hawkish" decision at the April meeting, but the central bank decided to wait and observe. Perhaps they hope inflation will not accelerate too much and then begin to slow? Before the next ECB meeting, two more inflation reports will be released, which can provide insight into the trend. However, at this moment, I see no reason for improvement in the energy situation.

It should also be noted that nothing is preventing the ECB from raising interest rates. Such a decision would slow the economy, but the central bank is prepared for it, unlike the Fed. In the US, tightening monetary policy is fundamentally unacceptable. Imagine the situation where the new Fed chair, Kevin Warsh, who is likely to be appointed to lower interest rates and influence the FOMC to adopt "dovish" decisions, has to announce a tightening! Donald Trump could very well dismiss the new central bank president. While he cannot actually do this, the situation could turn comical. Additionally, the US labor market does not currently allow for hopes of raising interest rates. Therefore, the euro is in a more favorable monetary situation.

This week, there will be several speeches from ECB President Christine Lagarde, Vice President Luis de Guindos, and Chief Economist Philip Lane. I expect these officials will clarify when and under what conditions the markets can expect interest rate hikes. Additionally, retail sales data for the EU will be released on Thursday, but this event is not currently of great interest to market participants. Thus, this week's main focus will be on geopolitics, important data from the US, and significant speeches from ECB officials.

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within the upward segment of the trend (bottom image) and, in the short term, is in a corrective structure. The corrective wave set appears quite complete and may only take on a more complex, elongated form if the geopolitical background in the Middle East does not worsen this week. Otherwise, a new downward segment of the trend may begin from the current positions. We have seen the corrective wave, and I expect further increases in the instrument from current levels, targeting around the 19 figure.

Wave Picture for GBP/USD:

The wave pattern for the GBP/USD instrument has become clearer over time, as I anticipated. Now we see a clear five-wave upward structure on the charts, which may be completed soon. If this is indeed the case, we can expect a corrective wave set to form. Therefore, the base scenario for the coming days is an increase into the 37 figure. Everything else will depend on geopolitical factors.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to forecast and are often subject to change.
2. If there is no confidence in the market, it is better not to enter.
3. There is never 100% certainty in the direction of movement. Always remember to use protective stop-loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

On Monday, the USD/CHF pair is approaching the convergence of several moving averages, adding 0.28% for the day amid a new wave of risk aversion that supports the US dollar.

Market participants' sentiment is currently influenced by concerns over the potential escalation of the conflict in the Middle East, arising from conflicting reports about an incident involving an American warship in the Strait of Hormuz. While some US sources have denied any missile strike, the ongoing uncertainty is pushing investors to reduce their exposure to riskier assets.

Tensions heightened after the Iranian news agency Fars reported that two missiles were fired toward an American warship that, according to Iran, ignored warnings from Tehran. This incident occurred amidst already existing tensions, soon after the US announced its plans to secure shipping safety in the region.

However, US officials have denied any direct missile strike, while Iranian sources suggested it could have been a warning shot that caused no confirmed damage. This uncertainty maintains a high degree of tension in the markets, especially in light of Iran's warning that any US intervention would be deemed a violation of the ceasefire.

The US dollar benefits from a surge in safe-haven capital, strengthening against major world currencies.

Rising oil prices, driven by geopolitical tensions, also reinforce this trend, as investors anticipate potential disruptions to global energy supplies.

In this context, traders are exercising caution ahead of the release of key economic data from the US, particularly the ADP report on private sector employment and, primarily, Friday's Nonfarm Payrolls (NFP) report. These data, along with speeches by Federal Reserve officials, are expected to provide additional clarity on monetary policy prospects following the hawkish statements last week.

Regarding the Swiss franc, the fundamental factors determining its exchange rate remain quite resilient, limiting its downside potential against the US dollar. Recent data indicate improved manufacturing activity: in April, the PMI in the manufacturing sector calculated by SVME rose to 54.5 points. However, as noted by Commerzbank, the Swiss National Bank (SNB) has little room left for consistently weakening the franc. The bank believes that significant interventions will be required to affect the exchange rate of the Swiss currency—a step that seems unlikely due to risks to the bank's balance and political constraints.

Thus, while the US dollar is currently supported by demand for safe-haven assets, the Swiss franc's structural resilience may limit further gains in the USD/CHF pair in the short term.

The table below shows the percentage change in the US dollar exchange rate against major currencies as of today. The US dollar's strongest positions were against the Australian dollar.

Silver (XAG/USD) starts the new week on a negative note, dropping to $73.50, reflecting a 2.41% loss as of Monday. The white metal is facing profit-taking amid a strengthening dollar and rising Treasury yields.

Events in the Strait of Hormuz continue to heighten market uncertainty. Iranian state media reports that missiles were allegedly fired at an American warship near this strategically important waterway after the vessel reportedly ignored warnings from the Islamic Revolutionary Guard Corps (IRGC). Although US officials have denied any damage to ships, this incident underscores the fragility of the current situation.

Washington, in turn, has initiated a naval operation to ensure the safety of commercial shipping routes in the region, prompting Tehran to warn of possible retaliatory measures with an increased military presence. The lack of progress in diplomatic negotiations between the two countries continues to fuel high levels of tension.

However, despite their traditional role, the current geopolitical context does not provide sustainable support for precious metals, as capital flows are primarily directed toward the US dollar.

The US currency benefits from rising demand for safe-haven assets and receives additional support from increasing Treasury yields, which directly pressures silver—a non-yielding asset. With expectations that interest rates will remain high for an extended period, silver's appeal diminishes.

Expectations regarding monetary policy remain a key factor influencing the market. Market participants believe the Federal Reserve will maintain a cautious stance amid ongoing inflationary risks, some of which are fueled by high energy prices linked to potential supply disruptions through the Strait of Hormuz.

According to the CME FedWatch Tool, investors are shifting the timelines for anticipated easing of monetary policy while pricing in the possibility of tightening in the long term.

Against this backdrop, the combination of a strong US dollar, rising bond yields, and persistent hawkish expectations regarding interest rates continues to limit silver's growth potential.

Investors should pay attention to upcoming macroeconomic data from the US—particularly labor market and business activity indicators—as well as speeches from Federal Reserve representatives for additional signals regarding the future trajectory of interest rates.

From a technical perspective, the drop below the 100-day SMA favors the bears; however, the 200-day SMA is angled upwards, indicating that silver will rise in the long term. In the near term, oscillators are negative, confirming the bulls' advantage. If prices cannot hold above the round level of 70.00, they will accelerate the decline to the 200-day EMA, then to the 200-day SMA, and finally to the round level of 61.00.

Let's start with the "Iran case." Unfortunately, the situation here is still far from de-escalation. The US and Iran maintain contacts through Pakistani intermediaries, but have yet to reach any agreement. On the negotiating table are two "competing" proposals that effectively reflect mutually exclusive positions: Iran's conditions are unacceptable to the United States, while the American demands, in turn, do not satisfy Tehran. Washington insists on the immediate opening of the Strait of Hormuz, guarantees for the safety of navigation, and long-term restrictions on Iran's nuclear program—up to a complete ban on enrichment. Meanwhile, the Iranian side insists on the lifting of all sanctions, the cessation of the US naval blockade, and the withdrawal of American troops from the region. According to Iranian representatives, the current negotiations should focus exclusively on the conditions for ending the war, not the "nuclear dossier."

Trump has already labeled Iran's new negotiation plan as "unacceptable." Simultaneously, he stated that American representatives are having "very positive" negotiations with Tehran.

Additionally, according to the US president, American forces will begin escorting civilian vessels stuck in the Strait of Hormuz this week. Iran has already criticized this statement. In particular, the chairman of the Iranian parliamentary committee on national security stated that US intervention in shipping in the region "will be regarded as a violation of the ceasefire." He noted that any attempts to influence the new order in the Strait "will provoke a response."

In other words, the situation remains extremely tense and contradictory. On the one hand, negotiators, through intermediaries, are exchanging proposals, demonstrating formal readiness for dialogue and a desire to keep the negotiation process actively engaged. On the other hand, the countries continue to exchange tough, belligerent rhetoric, signaling a lack of real progress in the negotiation process. In particular, representatives of the IRGC have warned of their readiness to resume full-scale hostilities in the event of a complete breakdown of diplomatic efforts. The United States, for its part, also shows readiness to return to a military scenario, maintaining a significant naval presence near Iran's borders.

Thus, the Middle Eastern factor continues to fuel demand for safe-haven assets—including the dollar.

An additional source of risk is the escalating trade tension between the US and the EU. Let me remind you that on May 1, Donald Trump announced that the United States would increase tariffs on passenger and cargo vehicles from the EU from 15% to 25%. The White House accused the European Union of failing to adhere to the terms of a trade deal reached in Scotland in July of last year. According to the American side, Brussels is deliberately stalling the ratification process of the reached agreement. It is essential to note that the EU has not yet lifted tariffs on imported American industrial goods (as agreed by both sides), despite nine months having passed since the deal was signed in Turnberry.

In response, Eurogroup President Kyriakos Pierrakakis stated that the EU would resort to retaliatory measures if Trump follows through on his threats and actually raises tariffs on European cars.

However, as of today, the situation remains in limbo. Trump has yet to sign the decree to raise tariffs, while the Europeans signal that they are speeding up the implementation of the "Turnberry agreements." Specifically, according to Reuters, the European Parliament and the EU Council will continue negotiations to lower tariffs on imports of American goods starting Wednesday, just 2 days away. But whether these negotiations will succeed and whether Trump will await their outcomes remains an open question.

Thus, the prevailing bearish sentiment regarding the EUR/USD pair is well-founded and justified. However, despite sellers actively testing the support level at 1.1690 (the middle line of the Bollinger Bands indicator on the W1 timeframe), they have thus far been unable to establish themselves within the 16 figure—largely due to the ongoing uncertainty surrounding both the "Iran case" and American trade policy. In this context, it is sensible to consider short positions on corrective pullbacks with the first (and currently only) target for the downward movement set at 1.1690.

West Texas Intermediate (WTI) crude oil, the American benchmark, is showing a partial recovery after trading began on Monday.

Over the past weekend, US President Donald Trump announced the United States' intention to take measures to free vessels trapped in the Strait of Hormuz. In response, Ebrahim Azizi, head of the Iranian Parliament's Committee on National Security and Foreign Policy, issued an official warning that any US intervention in the situation in this strategically important waterway would constitute a violation of the ceasefire. This situation creates additional risks for worsening conditions in the region and raises new concerns about potential disruptions in oil supplies through the Strait.

Additionally, the lack of progress in peace negotiations between the US and Iran adds to the uncertainty and supports higher crude oil prices.

Meanwhile, the alliance of oil-exporting countries, including OPEC and its allies, decided to increase oil production for the third consecutive month: in June, seven participating countries plan to raise output by 188,000 barrels per day. It is also worth noting that buying activity, spurred by expectations of a strengthening US dollar, has kept oil prices in the "red zone" for three trading days. Persistent geopolitical risks and renewed expectations for interest rate hikes by the Federal Reserve are strengthening the American currency. This circumstance suggests caution and does not allow for confident assertions that the recent pullback from the nearly two-month high recorded last Thursday is already complete.

From a technical perspective, oil is trading above all moving averages, with the nearest support being the 9-day EMA. Oscillators are positive, confirming the bulls' strong positions. Therefore, the path of least resistance remains upward.

The wave pattern on the 4-hour chart for EUR/USD has changed. There is still no talk of canceling the upward trend segment (shown in the lower chart), which began in January last year; however, the wave structure of the trend now looks quite ambiguous. In such situations, I always recommend switching to a lower timeframe (upper chart) and analyzing the simplest and smallest wave structures in order to make a short-term forecast, which is sufficient for opening trades. Wave structures can be very complex and allow for multiple scenarios. The easiest approach is to trade based on standard "five-three" patterns.

In the chart above, I can identify a classic five-wave impulse structure with an extended third wave. After the completion of this structure, a corrective formation of at least three waves began. We have already seen three waves, so in the near future the market will likely form at least one more downward corrective wave. How events develop further depends on geopolitics: whether the upward structure becomes more complex or a new downward trend segment begins.

The EUR/USD rate declined by 10 basis points on Monday, despite fairly strong intraday volatility. However, overall market activity—even on Monday, even with geopolitical news—remains relatively low. In general, I would not say that weak movements are necessarily a bad thing; on the contrary, they may even be easier to work with. At present, the instrument continues to form a downward wave, and everything suggests that we may see a complication of the upward structure. This conclusion is based on several factors.

First, important U.S. labor market and unemployment data will be released this week, and such data always poses increased risk for the dollar. Second, last week ended with another diplomatic failure by Tehran, and the new week began with renewed tensions in the Strait of Hormuz, including an attack on a U.S. destroyer. According to some reports, the damage was not significant, but Washington may now respond with a strike against Iran, which would nullify the already limited diplomatic efforts of recent weeks. However, despite all these negative developments, demand for the U.S. dollar declined only slightly. Last week, a failed attempt to break below the 1.1665 level led to a rebound from the lows, and so far the market has not attempted to move below it again. Therefore, I assume that the downward wave formation may be complete, and we could see a new upward movement targeting levels above the peak of wave C—closer to the 1.19 level. A key condition for this scenario is the absence of further escalation in the Middle East.

General Conclusions

Based on the analysis of EUR/USD, I conclude that the instrument remains within an upward trend segment (lower chart), while in the short term it is within a corrective structure. The corrective wave formation appears complete and could only become more complex and extended if the geopolitical situation in the Middle East does not deteriorate this week. Otherwise, a new downward trend segment may begin from current levels. Since we have already seen a corrective wave, I expect a new upward move from current levels with targets around the 1.19 level.

On a smaller timeframe, the entire upward trend segment is visible. The wave structure is not entirely standard, as corrective waves vary in size. For example, the higher-degree wave 2 is smaller than the internal wave 2 within wave 3. However, such cases do occur. I would like to emphasize that it is better to identify clear structures on charts rather than strictly adhere to labeling every wave. Recent waves are difficult to identify, which is why I rely more on the higher timeframe in my analysis.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to trade and often subject to change.
2. If there is no confidence in market conditions, it is better to stay out.
3. There is never 100% certainty about market direction—always use protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

There is little more to add regarding the news background at this time. The situation surrounding the resolution of the Middle East conflict has effectively stalled, and traders are uncertain about which direction events will take next. For now, bulls retain the upper hand, but if escalation intensifies, bears may launch their own offensive.

The pound's rise began with a "Three Drives pattern." Thus, traders received a bullish signal at the very start of the move, and the trend remains bullish. At present, the ceasefire in the Middle East is quite fragile, and the parties to the conflict have not yet decided whether to continue negotiations or resume hostilities. Negotiations may resume—but so might the conflict. The Strait of Hormuz remains under dual blockade, and Tehran and Washington cannot even agree on the next round of talks, let alone a comprehensive agreement to end the conflict. As of Monday, nothing has changed for two weeks—certainly not for the better. Both sides express willingness to reach a deal verbally, but in practice, no concrete steps are being taken.

The "Three Drives pattern," marked by a triangle on the chart, allowed bulls to take the initiative. Imbalance 18 provided traders with a buying opportunity, and imbalance 19 did so again. As a result, three bullish signals have formed within the current impulse, and a new bullish imbalance 20 was created on Friday. Bearish patterns and liquidity grabs are not causing significant concern for bulls. Only geopolitics could hinder further bullish advances in the coming days.

There was no significant economic news on Monday. Last week, the Bank of England supported bulls, but geopolitical developments on Friday and Monday have so far offset these gains. Imbalance 20 serves as a support zone, but it is not an impenetrable barrier.

In the United States, the overall fundamental backdrop still suggests that, in the long term, little can be expected from the dollar other than decline. Even the conflict between Iran and the United States does not change much. Geopolitics briefly restored the dollar's safe-haven appeal for about two months, but the broader outlook for the U.S. currency remains challenging. The U.S. labor market continues to weaken, the economy is approaching recession, and the Federal Reserve—unlike the ECB and the Bank of England—does not plan to tighten monetary policy in 2026. Additionally, there have been several large-scale protests across the United States against Donald Trump, and a potential departure of Jerome Powell could further weaken the dollar (especially if the FOMC adopts a more dovish stance under Kevin Warsh). From an economic standpoint, I see no grounds for dollar strength.

News calendar for the U.S. and the U.K.:

• U.S. – ISM Services PMI (14:00 UTC)
• U.S. – JOLTS Job Openings (14:00 UTC)
• U.S. – New Home Sales (14:00 UTC)

On May 5, the economic calendar includes three events, with the ISM index being the most notable. The impact of the news background on market sentiment may be felt in the second half of the day.

GBP/USD forecast and trader advice:

For the pound, the long-term outlook remains bullish. The "Three Drives pattern" signaled the beginning of the upward move, and since then three bullish patterns and two bullish signals have formed. Thus, under current conditions, despite geopolitical risks, I expect the pound to continue rising. However, it must be acknowledged that geopolitics could disrupt this scenario. I consider the 2026 high as the target for the pound. The reaction to imbalance 16 caused a corrective pullback, while the reaction to imbalance 19 provided traders with a new buying opportunity. At present, a reaction to imbalance 20 may occur, potentially offering another bullish signal.

In the current situation, traders can only wait for the resolution of imbalance 13 or the formation of new bullish patterns. I continue to consider the trend "bullish." Last week, bulls fell just short of resolving imbalance 13 and generating a signal. There are no bearish patterns at the moment, so there is no clear basis for selling the pair. The previous buy signal from imbalance 12 worked perfectly, with the euro gaining approximately 270 points.

It is also worth noting that the entire rise of the U.S. dollar from January to March was driven solely by geopolitics. As soon as the U.S. and Iran agreed to a ceasefire, bears immediately retreated, and bulls launched an offensive. At present, the truce is quite fragile but still holding. I have repeatedly stated that I do not believe the bullish trend has ended, despite the break of important trend-forming lows. The price movement over the past two months could turn into a bearish trend if geopolitical conditions continue to deteriorate. However, markets often price in the most pessimistic scenario, trying to anticipate the most extreme developments. Therefore, it is possible that traders have already fully priced in the geopolitical conflict in the Middle East. For further bullish attacks, there is currently a lack of positive factors, while bears lack sufficient negative catalysts.

The overall chart picture is currently clear. The bullish advance remains intact but requires support. This week, support may come from U.S. labor market data, unemployment figures, job openings, ISM business activity reports, as well as geopolitical developments. As we can see, Monday did not start calmly, but I would not yet speak of a full-scale escalation in the Middle East.

The information background on Monday was absent (apart from geopolitics). ECB President Christine Lagarde is scheduled to speak in the evening, but I do not expect significant statements regarding monetary policy. The ECB meeting took place last week, and traders already understand the regulator's stance for the coming months. Everything will depend on energy prices and inflation.

Bulls still have plenty of reasons to push higher in 2026, and even the outbreak of war in the Middle East has not reduced them. Structurally and globally, Trump's policy—which led to a significant decline in the dollar last year—has not changed. In the coming months, the U.S. currency may occasionally strengthen amid risk aversion, but this requires ongoing escalation in the Middle East. I still do not believe in a bearish trend. The dollar has received temporary market support, but what will sustain a long-term bearish move?

News calendar for the U.S. and the Eurozone:

• Eurozone – Speech by ECB President Christine Lagarde (12:30 UTC).
• U.S. – ISM Services PMI (14:00 UTC).
• U.S. – JOLTS Job Openings (14:00 UTC).
• U.S. – New Home Sales (14:00 UTC).

On May 5, the economic calendar contains four entries, two of which are of interest. The impact of the news background on market sentiment on Tuesday may be felt in the second half of the day.

EUR/USD forecast and trader advice:

In my opinion, the pair remains in the formation stage of a bullish trend. The information backdrop changed sharply two months ago, but the trend cannot be considered canceled or completed. Therefore, in the near future, bulls may well continue their advance if geopolitics does not sharply turn toward a new escalation.

Traders had the opportunity to open buy positions based on the signal from imbalance 12, and the upward movement may continue toward the yearly highs. Imbalance 13 has also formed and may generate a bullish signal in the near future. For the euro to grow without obstacles, the Middle East conflict must move toward a stable peace—something that is not currently observed. Bulls currently lack sufficient support but may gain it during the week.

The USD/JPY pair is attracting buyers who are using the recent decline to enter the market after the drop to the 155.50 level. The pair is attempting to break above the round level of 157.00; however, this momentum has not been sustained, so market participants should remain cautious before opening positions in anticipation of a continued confident recovery that began on Friday. Escalating concerns about further conflict in the Middle East are supporting the U.S. dollar, adding strength to the USD/JPY pair.

U.S. President Donald Trump announced the launch of "Project Freedom," under which the United States will begin escorting neutral vessels through the Strait of Hormuz. Trump emphasized that if obstacles arise, the U.S. will act using force. In response, Ibrahim Azizi, head of Iran's parliamentary commission on national security and foreign policy, warned that any U.S. intervention in this strategically important waterway would be considered a violation of the ceasefire.

At the same time, Minneapolis Federal Reserve President Neel Kashkari stated on Sunday that the prolonged conflict with Iran creates inflation risks and may negatively impact the economy. He did not rule out the possibility of interest rate hikes given the uncertainty surrounding the conflict. These comments are supporting the U.S. dollar and contributing to the rise of the USD/JPY pair.

However, reports of possible currency interventions by Japanese authorities in May—when around 5.4 trillion yen (approximately $34.5 billion) was spent to support the weakening yen—may discourage bears from opening new positions against the Japanese currency, potentially limiting further growth of the pair.

As for the outlook, no significant economic data releases from the U.S. are expected on Monday that could influence the market; therefore, the fate of the dollar and the USD/JPY pair will depend entirely on new developments related to the Middle East crisis.

Nevertheless, given the current fundamental backdrop, it is prudent to wait for confirmation in the form of active buying before concluding that a short-term price bottom has formed and opening long positions.

From a technical perspective, oscillators remain negative, confirming the weakness of bulls. Bulls need to secure a position above 157.00 and break the 50-day SMA to gain a chance of taking control.

Gold (XAU/USD) continues to show intraday decline, falling below the $4,550 level. Investors have begun to view energy shocks caused by geopolitical instability in the Middle East as factors that could revive inflationary pressure and force major central banks, including the U.S. Federal Reserve, to adopt a more hawkish stance. This is having a significant negative impact on demand for the precious metal.

U.S. President Donald Trump announced the initiation of an operation to escort vessels blocked in the Persian Gulf through the Strait of Hormuz as part of a project called "Project Freedom." He also warned that decisive measures would be taken if the operation fails. In turn, a leading Iranian parliamentarian, Ibrahim Azizi, stated that any U.S. intervention in this strategically important route would be considered a violation of the ceasefire. Moreover, the Islamic Revolutionary Guard Corps (IRGC) accused the United States of breaching agreements and indicated a possible resumption of conflict. This casts doubt on diplomatic efforts to end the conflict amid a lack of progress in peace talks between Washington and Tehran and keeps oil prices elevated.

This situation coincides with the release of U.S. macroeconomic data on Thursday, which showed an acceleration in inflation in March and reinforced expectations that the Federal Reserve may keep interest rates unchanged throughout the next year. The central bank's decision to maintain the key interest rate in the 3.50%–3.75% range became the most controversial since 1992, with three committee members voting against the dovish stance. Additionally, on Sunday, Minneapolis Federal Reserve President Neel Kashkari stated that a prolonged conflict with Iran increases inflation risks and economic damage, allowing for the possibility of rate hikes amid uncertainty surrounding the war.

Hawkish rhetoric is supporting demand for the U.S. dollar following a minor bearish correction earlier in the week, which is seen as another factor putting pressure on gold prices.

At the same time, bears trading XAU/USD should act cautiously—an excess of selling is limiting further downside. Investors are closely awaiting key U.S. macroeconomic data scheduled for early in the month, including the quarterly Nonfarm Payrolls (NFP) report on Friday, which could significantly impact market conditions. However, the current fundamental backdrop suggests that the primary direction for the precious metal remains downward.

From a technical perspective, oscillators are negative. If gold fails to hold above $4,500, it may accelerate its decline toward the 200-day EMA. Bulls need to break above the 20-day SMA to gain a chance for further growth.

A necessary condition, however, is breaching the 80,000 ceiling. Heavy demand from institutional and retail investors for derivatives with strikes near that level has forced intermediaries — dealers — to hedge on the derivatives exchange Deribit. Every time the price approaches the psychologically important mark, automatic selling is triggered, producing sharp pullbacks.

Derivatives demand by strike reflects the fragility of the move. Geopolitics can also become a major obstacle for risky assets. The earnings season and discounted fundamental valuations of US stocks provided a reason to buy and allowed investors to look past the Middle East conflict. But nothing lasts forever. As more companies report Q1 results, markets will have to refocus on the US–Iran confrontation. The absence of a clear peace plan will put pressure on the S&P 500 and digital assets.

Despite a 20% BTC/USD rally since the onset of hostilities in the Middle East, the cryptocurrency remains highly sensitive to the performance of US stock indices and global risk appetite. On May 1, when the S&P 500 hit a new record, bitcoin?focused ETF-style funds attracted $630 million.

Fed funds rate expectations dynamic

Even if the digital asset clears 80,000, a rally above 100,000 looks doubtful. When bitcoin traded at historical peaks in October 2025, the Fed was easing monetary policy. Today, the futures market prices a 79% probability that the federal funds rate will remain at 3.75% through the end of 2026. Derivatives put the chance of a rate rise at 15% and a rate cut at 6%.

Thus, for the rally to continue and for a genuine uptrend to be restored, bitcoin needs to break the 80,000 ceiling — which currently seems unlikely. Still, never say never.

Technically, the daily chart formed a bar with a long upper wick that may be a pin bar. A common way to trade it is to place a pending sell order at the low, near 78,200.

According to the report, despite growing interest from corporations and funds, the process of mass BTC adoption remains at an early stage. The practice of large players, such as corporates and investment funds, acquiring Bitcoin is only beginning to gain traction, and there is still a long way to go before it becomes a truly widespread asset in their portfolios.

The bank notes that the initial push to integrate BTC into corporate treasuries was driven both by a search for new sources of return and by a desire to diversify assets amid a volatile macroeconomic backdrop, as well as by the emergence of ETFs. However, there are also serious obstacles slowing the process. These include the asset's high volatility, regulatory uncertainty across jurisdictions, and issues around secure custody and management of digital assets.

Morgan Stanley emphasizes that scaling BTC adoption further will require solving a number of key problems. These include the development of more robust, regulated custodial solutions, the creation of transparent, standardized instruments for trading and managing crypto assets, and improved awareness and staff training. As these barriers are overcome, the bank expects a gradual increase in BTC allocations within institutional portfolios.

Trading recommendations:

Regarding Bitcoin's technical picture, buyers are currently targeting a return to $80,300, which opens a direct route to $82,000, and from there to $84,000. The most distant target is the high around $85,600, breaching which would signal attempts to return to a bull market. In case of a decline, I expect buyers at $78,200. A fall below that area could quickly push BTC toward $76,300. The furthest target there would be around $74,700.

Regarding Ethereum's technical picture, a clear consolidation above $2,353 opens a direct route to $2,409. The most distant target is the high near $2,492, breaching which would indicate strengthening bullish sentiment and a return of buyer interest. In case of a decline, I expect buyers at $2,290. A return of the instrument below that area could quickly send ETH toward $2,225. The furthest target there would be around $2,162.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines indicate the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines indicate the 200-day moving average.

A crossover, or a price test of moving averages, typically either halts the move or sparks fresh market momentum.

The test of the 156.91 level occurred when the MACD indicator had just begun moving upward from the zero mark, confirming a valid entry point for buying the dollar. As a result, the pair rose by 30 points.

Amid reports of a possible Iranian attack on a U.S. military ship in the Strait of Hormuz area, the dollar resumed its rise while the Japanese yen weakened. A return of the USD/JPY pair to the 157.50 level could be a risky moment, as in recent days the Bank of Japan has repeatedly intervened at this level, conducting currency interventions and strengthening the yen.

In the second half of the day, attention will focus on U.S. factory orders data. An increase in orders may signal rising demand for goods, supporting economic recovery, which would strengthen the dollar and weaken the yen. Conversely, a decline may indicate slowing production and potential risks to economic growth.

Alongside macroeconomic data, a speech by Federal Open Market Committee member John Williams will have a significant impact. His statements are often seen as a precursor to future monetary policy. Investors will carefully analyze his remarks for signals regarding possible interest rate adjustments, plans for open market operations, or other measures aimed at controlling inflation and supporting economic growth. Particular interest will be in his assessment of the current inflation environment and outlook.

As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and No. 2.

Buy signal

Scenario No. 1: I plan to buy USD/JPY today when the entry point is reached around 157.35 (green line on the chart), with a target of 158.29 (thicker green line on the chart). Around 158.29, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move). Growth in the pair today is likely if U.S. data is strong.Important! Before buying, make sure the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today in the case of two consecutive tests of the 156.99 level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward reversal. Growth toward the opposite levels of 157.35 and 158.29 can be expected.

Sell signal

Scenario No. 1: I plan to sell USD/JPY today after a break below the 156.99 level (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 155.95, where I will exit short positions and also open long positions in the opposite direction (expecting a 20–25 point move). Pressure on the pair will return today if U.S. data is weak.Important! Before selling, make sure the MACD indicator is below the zero mark and just beginning to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today in the case of two consecutive tests of the 157.35 level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 156.99 and 155.95 can be expected.

What's on the chart:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated level to place Take Profit or manually lock in profits, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated level to place Take Profit or manually lock in profits, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to rely on overbought and oversold zones.

Important: Beginner traders in the Forex market should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember that successful trading requires a clear trading plan, like the one outlined above. Spontaneous decision-making based on current market conditions is inherently a losing strategy for an intraday trader.

The test of the 1.3580 level occurred when the MACD indicator had just started moving downward from the zero mark, confirming a valid entry point for selling the pound. As a result, the pair declined to the target level of 1.3540.

The pound fell in response to news that Iran had attacked a U.S. military ship attempting to enter the Strait of Hormuz area. However, U.S. media have not yet confirmed this information. This discrepancy in the information flow, combined with elements of geopolitical uncertainty, traditionally puts pressure on developed market currencies, and the British pound was no exception. The lack of confirmation from U.S. media adds intrigue and uncertainty. This could indicate either a deliberate withholding of information by Washington until all circumstances are clarified or a denial that has not yet been widely disseminated.

As for the data, a report on U.S. factory orders is expected in the second half of the day. It is assumed that the upward trend will continue, but significant deviations from forecasts could trigger noticeable volatility in financial markets. The upcoming speech by Federal Open Market Committee member John Williams is also of interest. Statements from this Federal Reserve representative regarding the current economic situation, inflation expectations, and the future path of monetary policy could significantly influence market expectations for future interest rates. Any hints of a possible shift in rhetoric or change in emphasis could prompt traders to reassess their expectations.

As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and No. 2.

Buy signal

Scenario No. 1: I plan to buy the pound today when the entry point is reached around 1.3557 (green line on the chart), with a target of 1.3602 (thicker green line on the chart). Around 1.3602, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move). Growth in the pound today can be expected only after weak U.S. data.Important! Before buying, make sure that the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario No. 2: I also plan to buy the pound today in the case of two consecutive tests of the 1.3531 level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward reversal. Growth toward the opposite levels of 1.3557 and 1.3602 can be expected.

Sell signal

Scenario No. 1: I plan to sell the pound today after a break below the 1.3531 level (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 1.3485, where I will exit short positions and also open long positions in the opposite direction (expecting a 20–25 point move). Pressure on the pound will return today if U.S. data is strong.Important! Before selling, make sure that the MACD indicator is below the zero mark and just beginning to decline from it.

Scenario No. 2: I also plan to sell the pound today in the case of two consecutive tests of the 1.3557 level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.3531 and 1.3485 can be expected.

What's on the chart:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated level to place Take Profit or lock in profits manually, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated level to place Take Profit or lock in profits manually, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to rely on overbought and oversold zones.

Important: Beginner traders in the Forex market should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember that successful trading requires a clear trading plan, like the one outlined above. Spontaneous decision-making based on current market conditions is inherently a losing strategy for an intraday trader.

The test of the 1.1723 price level occurred when the MACD indicator had just started moving downward from the zero mark, which confirmed a valid entry point for selling the euro. As a result, the pair declined by 33 points.

The first half of the day could have been relatively calm if not for the news about a suspected Iranian attack on a U.S. military ship in the Strait of Hormuz area. The sharp weakening of the euro was driven by market participants' concerns about a possible escalation in the Middle East. However, the lack of confirmation from official U.S. sources halted the decline in risk assets, including the euro. It is clear that traders will continue to closely monitor news flows, trying to assess the real level of threat and its potential consequences.

In addition, during the second half of the day, attention will be focused on several important U.S. macroeconomic data releases. One of the key indicators to watch is the change in factory orders. This indicator reflects activity in the industrial sector, which is an important component of overall economic dynamics. Positive momentum in factory orders may signal growing demand for goods, which in turn has a favorable impact on the economy. Alongside economic data, particular attention will be paid to remarks from Federal Open Market Committee member John Williams. As a representative of the Federal Reserve leadership, his comments are often seen as an indicator of future monetary policy. His assessment of the current inflation situation and its outlook may be of particular interest.

As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and No. 2.

Buy signal

Scenario No. 1: Today, buying the euro is possible when the price reaches around 1.1725 (green line on the chart), with a target of 1.1779. At 1.1779, I plan to exit the market and also sell the euro in the opposite direction, expecting a movement of 30–35 points from the entry point. A rise in the euro today can be expected only after weak U.S. data.Important! Before buying, make sure that the MACD indicator is above the zero mark and just starting to rise from it.

Scenario No. 2: I also plan to buy the euro today in case of two consecutive tests of the 1.1690 level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward reversal. Growth toward the opposite levels of 1.1725 and 1.1779 can be expected.

Sell signal

Scenario No. 1: I plan to sell the euro after the price reaches 1.1690 (red line on the chart). The target will be 1.1646, where I plan to exit the market and immediately buy in the opposite direction (expecting a 20–25 point move in the opposite direction). Pressure on the pair will return today if U.S. data is strong.Important! Before selling, make sure that the MACD indicator is below the zero mark and just starting to decline from it.

Scenario No. 2: I also plan to sell the euro today in case of two consecutive tests of the 1.1725 level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.1690 and 1.1646 can be expected.

What's on the chart:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated level to place Take Profit or manually lock in profits, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated level to place Take Profit or manually lock in profits, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to rely on overbought and oversold zones.

Important: Beginner traders in the Forex market should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss orders, you can very quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember that successful trading requires a clear trading plan, like the one outlined above. Spontaneous decision-making based on the current market situation is inherently a losing strategy for an intraday trader.

The euro, pound, and other risk assets declined following news that Iran had attacked a U.S. military ship attempting to enter the Strait of Hormuz area. However, the Americans have so far denied that such an attack took place. It hardly needs to be reminded that the situation in the Strait of Hormuz region is currently one of the key factors determining the future direction of the U.S. dollar and risk assets. The observed volatility indicates increased sensitivity of financial markets to geopolitical risks. Nevertheless, the lack of official confirmation from U.S. sources calls for caution.

In the second half of the day, attention will also be focused on U.S. factory orders data. These figures are traditionally considered a leading indicator of business activity and may provide insight into the condition of the U.S. industrial sector. Positive trends are expected to continue; however, any deviation from forecasts could trigger some market volatility.

Additionally, remarks from FOMC member John Williams will be of significant interest. His comments on the current economic situation, inflation expectations, and the outlook for monetary policy could have a substantial impact on market expectations regarding future interest rates.

In the case of strong data, I will rely on the Momentum strategy. If there is no market reaction to the data, I will continue using the Mean Reversion strategy.

Momentum strategy (breakout) for the second half of the day:

For EUR/USD:

• Buying on a breakout of 1.1723 may lead to euro growth toward 1.1749 and 1.1767;
• Selling on a breakout of 1.1698 may lead to a decline toward 1.1675 and 1.1657;

For GBP/USD:

• Buying on a breakout of 1.3569 may lead to pound growth toward 1.3600 and 1.3627;
• Selling on a breakout of 1.3537 may lead to a decline toward 1.3504 and 1.3481;

For USD/JPY:

• Buying on a breakout of 157.40 may lead to dollar growth toward 157.70 and 157.99;
• Selling on a breakout of 156.90 may lead to dollar selling toward 156.66 and 156.30;

Mean Reversion strategy (pullback) for the second half of the day:

For EUR/USD:

• I will look for selling opportunities after a false breakout above 1.1735 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 1.1691 followed by a return to this level;

For GBP/USD:

• I will look for selling opportunities after a false breakout above 1.3585 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 1.3517 followed by a return to this level;

For AUD/USD:

• I will look for selling opportunities after a false breakout above 0.7202 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 0.7171 followed by a return to this level;

For USD/CAD:

• I will look for selling opportunities after a false breakout above 1.3619 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 1.3590 followed by a return to this level;

The wave structure on the hourly chart currently raises no concerns. The last completed downward wave broke the previous low by only a few points, while the last upward wave broke the previous peak. Thus, the trend is once again shifting to "bullish." A temporary truce between Iran and the United States supported the bulls, allowing them to form a strong upward wave. However, now, three weeks later, it can be said that geopolitics is once again moving in a completely different direction. Therefore, bullish attacks may be restrained.

There was little economic data in the Eurozone and the U.S. on Friday; I can only note the ISM Manufacturing PMI for the United States. I cannot say that this index turned out weak, although traders expected a stronger reading than 52.7 points. However, compared to the previous month, no decline in the index was recorded, so its value can be considered neutral. Nevertheless, traders barely noticed this economic report, because in the evening it became known about a possible escalation of the conflict between Iran and the United States. Another proposal from Tehran to reach an agreement and unblock the Strait of Hormuz was rejected by Donald Trump, and in my opinion, the longer negotiations drag on without any progress, the higher the likelihood of renewed hostilities. Oddly enough, oil prices have declined slightly in recent days, but overall they remain close to their peak levels. Thus, I would not draw conclusions about falling energy prices in global markets. There are no grounds for a decline: the Strait of Hormuz remains closed, negotiations between the U.S. and Iran are at a deadlock, global energy reserves are shrinking rapidly, and there is no light at the end of the tunnel yet.

On the 4-hour chart, the pair reversed in favor of the U.S. dollar and began a downward movement toward the 76.4% corrective level at 1.1617. A rebound from the 1.1778 level again allows expectations of some decline. However, in my view, the hourly chart is currently more informative due to the weakness of movements. Bulls seized the initiative in the market about a month ago, but are now searching for new growth drivers. No emerging divergences are observed today on any indicator.

Commitments of Traders (COT) report:

During the last reporting week, professional traders closed 316 Long positions and opened 5,296 Short positions. Over seven weeks in February and March, the total advantage of the bulls evaporated, and over the last five weeks the situation has somewhat stabilized. The total number of Long positions held by speculators now stands at 217 thousand, while Short positions amount to 181 thousand. The gap is once again widening in favor of the euro.

Overall, in the long term, major players continue to look with strong interest toward the euro. Of course, events of various kinds around the world—of which there has been no shortage in recent years—affect investor sentiment. In particular, the market's attention remains focused on the Middle East, where the war has only been paused, not ended. Thus, in the near future, the euro and dollar exchange rates will depend not on Federal Reserve or ECB monetary policy or economic data, but on developments in Iran.

News calendar for the U.S. and the Eurozone:

• Germany – Manufacturing PMI (07:55 UTC).
• Eurozone – Manufacturing PMI (08:00 UTC).

On May 4, the economic calendar contains two secondary entries. The impact of the news background on market sentiment on Monday will once again be absent.

EUR/USD forecast and trader advice:

Selling the pair is possible today upon a rebound from the 1.1745 level on the hourly chart, with a target of 1.1666. I previously recommended buying on a rebound from 1.1666 with a target of 1.1745; that target was reached. New buying positions can be considered upon a close above 1.1745, with a target of 1.1824.

Fibonacci levels are drawn from 1.2082–1.1410 on the hourly chart and from 1.1474–1.2082 on the 4-hour chart.

The wave structure remains "bullish." The last completed downward wave did not break the previous low, while the last upward wave broke the previous peak. Geopolitics provided bears with an almost complete advantage in the market for two months, after which the geopolitical backdrop supported bulls for three weeks. At the moment, the situation in the Middle East is contradictory but shifting toward escalation of the conflict and a prolonged confrontation between Iran and the United States. It will be difficult for bulls in the coming weeks.

The information background on Friday was quite weak and was represented only by the ISM Manufacturing PMI for the U.S. Even this index was quickly overshadowed by news related to Middle East geopolitics. I have already discussed this event in the EUR/USD article and recommend reading it for those who haven't. As for the dynamics of the currency pair this week, the market will focus on U.S. labor market and unemployment statistics, but they will only be available on Friday. During the rest of the week, traders will have to rely on less important reports. The only exception may be the ISM Services PMI. If Friday's data disappoints, bulls may begin to attack more actively. However, it should be remembered that geopolitical news reaches the market without warning, and its nature cannot be predicted in advance. Thus, regardless of U.S. labor market data, geopolitical news may override it. Last week, the Bank of England provided noticeable support to bulls, but this factor will not be enough to sustain them throughout the current week. New data is needed. Escalation in the Middle East is definitely not needed for the pound to rise. For the U.S. dollar to rise, on the contrary, escalation, a complete failure in negotiations, and strong labor market data are needed.

On the 4-hour chart, the pair consolidated above the descending trend channel, which allows expectations of a full-fledged bullish trend. Consolidation above the Fibonacci level of 38.2% at 1.3540 allows for expectations of continued growth toward the 23.6% corrective level at 1.3664, but the chart picture on the hourly timeframe is currently clearer. I recommend paying closer attention to this chart. No emerging divergences are observed today.

Commitments of Traders (COT) report:

The sentiment of the "Non-commercial" trader category became more bearish over the last reporting week. The number of Long positions held by speculators decreased by 3,509, while the number of Short positions increased by 5,091. The gap between Long and Short positions is now essentially: 59 thousand versus 120 thousand. For six consecutive weeks, non-commercial traders have actively increased sales and reduced purchases, leading to a strong imbalance between Long and Short positions. In recent months, bears have dominated, which raises no questions given the geopolitical situation.

I still do not believe in a bearish trend for the pound, but now everything depends not on economic indicators, Trump's trade policy, or central bank monetary policy, but on the duration, scale, and consequences of the war in the Middle East. In recent weeks, the market had shifted toward expectations of de-escalation, but the latest news suggests that a full ceasefire is still far off, and the war could resume at any moment. In this case, the advantage of the bears could become even stronger.

News calendar for the U.S. and the U.K.:

On May 4, the economic calendar contains no notable events. The impact of the news background on market sentiment on Monday will be absent.

GBP/USD forecast and trader advice:

Selling the pair is possible today upon a rebound on the hourly chart from the 1.3596–1.3620 level, with targets at 1.3513–1.3539 and 1.3428–1.3437. Buying is possible today upon a close above the 1.3596–1.3620 level, with a target of 1.3700.

Fibonacci levels are drawn from 1.3866–1.3158 on the hourly chart and from 1.3012–1.3868 on the 4-hour chart.

He forecast that the bill could be sent to the president for signature as early as this summer. This statement is an important signal for the entire crypto industry, which has long pressed for legislative regulation of the digital asset market.

Recently, Treasury Secretary Scott Bessent, along with many industry representatives, has actively called for the swift adoption of a law that would establish a clear framework for the cryptocurrency market. Such calls underscore growing recognition of the need for regulatory clarity to protect investors and to ensure the sector's stable development. The CLARITY Act is expected to become that long-awaited document, intended to clarify the legal status of various digital assets and the operations involving them.

Market participants, in turn, place great hopes on the CLARITY Act's passage. Many believe that once the bill is approved and becomes law, it will trigger a significant inflow of institutional capital. Institutional investors, large funds, and banks often refrain from investing in unregulated or insufficiently regulated markets because of elevated risks. Clear rules and statutory norms provided by the CLARITY Act are designed to remove those concerns, opening the doors to large-scale capital inflows. Such capital injections would be a powerful bullish driver, capable of substantially raising the value of digital assets and taking the market to a new level of development.

Trading recommendations:

Regarding Bitcoin's technical picture, buyers are currently targeting a return to $80,900, which opens a direct route to $81,100, and from there to $83,100. The most distant target is the high near $85,600, breaching which would signal attempts to return to a bull market. In case of a decline, I expect buyers at $79,300. A fall below that area could quickly push BTC toward $77,700. The furthest target there would be around $76,300.

Regarding Ethereum's technical picture, a clear consolidation above $2,409 opens a direct route to $2,492. The most distant target is the high near $2,575, breaching which would indicate strengthening bullish sentiment and a return of buyer interest. In case of a decline, I expect buyers at $2,353. A return of the instrument below that area could quickly send ETH toward $2,290. The furthest target there would be around $2,225.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines indicate the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines indicate the 200-day moving average.

A crossover, or a price test of moving averages, typically either halts the move or sparks fresh market momentum.

In an interview, the head of the Bank of Greece stated that so far there are no clear signs of a material impact from higher energy prices on inflation, although it is still too early for precise assessments. He said that the ECB, which last week left interest rates unchanged, is focusing its analysis on the risk of so-called second-round effects, such as stronger wage pressures, higher prices, and rising inflation expectations.

He said that the ECB's response would depend on the intensity and duration of the Middle East conflict, commenting on its potential impact on the eurozone economy. His assessment underlines the delicate balance the ECB will have to strike in making future policy decisions.

First, the regulator will assess the nature of the energy shock caused and exacerbated by the Middle East conflict. He explained that, if the energy shock proved temporary and did not lead to significant second-round effects — such as broad transmission of inflation to other sectors or long-term supply chain disruptions — there would be no need to adjust monetary policy. In that case, the ECB would likely continue to follow its current strategy, refraining from premature action.

However, if the consequences prove more pronounced, policy scenarios may require intervention. He noted that if this led to a material, but not particularly persistent, overshoot of the ECB's inflation target, a measured policy adjustment would reduce the intensity of second-round effects. This could mean, for example, a moderate rate increase aimed at cooling the economy without sharply curbing growth.

The most severe scenario envisages a significant and prolonged inflation surge. He stressed that, if this resulted in a substantial and lasting deviation of inflation from the target, the response would have to be decisive. In such a situation, the ECB may resort to a more aggressive tightening stance, including sizeable rate hikes, to secure price stability over the long term, even at the cost of slower economic growth.

Technical picture, EUR/USD

Regarding the current technical picture for EUR/USD, buyers should now consider how to take the 1.1750 level. Only this will allow a test of 1.1767. From there, a move to 1.1784 would be possible, but achieving that without support from major players will be rather difficult. The most distant target is the high at 1.1805. In the event of a decline only to around 1.1720, I expect some serious action from large buyers. If there is nobody there, it would be prudent to wait for a refresh of the low at 1.1695 or to open long positions from 1.1675.

Technical picture, GBP/USD

As for the current technical picture for GBP/USD, pound buyers need to take the nearest resistance at 1.3600. Only this will allow a target of 1.3625, above which breaking through will be rather difficult. The most distant target is the 1.3650 area. In the event of a fall, bears will try to seize control at 1.3560. If they succeed, a break of the range will deal a serious blow to bulls' positions and push GBP/USD toward the low at 1.3535, with the prospect of reaching 1.3505.

Meanwhile, CryptoQuant analysts reported that April's Bitcoin rally was driven by demand for perpetual futures while spot demand stayed negative. In plain terms, traders in April were opening leveraged long positions, indicating a speculative character to the advance. Long-term spot investors were largely selling the "digital gold." If this is mainly speculation, the market is not positioned for sustained, long-term buying, and even a small drop could trigger liquidations and profit?taking on longs. CryptoQuant also noted that such futures-driven rises typically do not change the underlying trend.

The divergence between spot and futures demand best reflects the fragility of the move. This kind of advance is built on leverage and a thirst for quick gains — it cannot be stable or long-lasting by nature. CryptoQuant also pointed to the lack of a fundamental base for further growth. Once the "futures leg" finishes, markets often move into a correction. In a bear market, the futures leg itself is merely a corrective phase, so the downtrend can resume after it ends. CryptoQuant even said the current market structure strongly resembles 2022: without a shift to positive spot demand, any rise lacks support for continuation.

Trading recommendations for BTC/USD

Bitcoin continues to form a full downtrend with corrective rallies against it. We still expect a decline toward $57,500 (the 61.8% Fibonacci retracement of the three?year uptrend), and there are currently no signs of a trend reversal. Even $57,500 does not look like a definitive bottom. The only POI right now is the nearest bearish FVG on the daily TF around $79,300–$81,200. Bitcoin has reacted to this zone for the third time, so we would again expect a response there. However, new reversal evidence will be needed now — structure breaks on lower TFs and formation of new bearish patterns. Downside targets remain below $60,000.

Trading recommendations for ETH/USD

On the daily TF, a downtrend and corrective moves against it are still forming. The key sell setup remains the bearish weekly order block. As we warned, the move triggered by that signal can be strong and prolonged — and we don't believe it's finished. In the near term, ETH may continue a weak upward correction, but all corrections end sooner or later. A sell signal could form on the daily TF at the next FVG, and Bitcoin may produce its own signal on a third attempt. Therefore, watch for structure breaks on lower TFs and the formation (or reaction to) bearish patterns on higher TFs. A target at the 2026 low — $1,744 — looks quite achievable.

CHOCH — change of character / break of the trend structure.

Liquidity — liquidity, traders' Stop?Losses that market?makers use to build their positions. FVG — Fair Value Gap (area of price inefficiency). The price often moves quickly through such areas, indicating the absence of one side in the market. Later, the price tends to return and react to these zones. IFVG — Inverted Fair Value Gap. After a return to such a zone, the price does not react but impulsively breaks through and then tests it from the other side.

OB — Order Block. A candle on which a market?maker opened a position in order to harvest liquidity and then form their own position in the opposite direction.

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Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

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S&P 500 companies beating and missing estimates

While roughly one in two of every three S&P 500 issuers have beaten Wall Street estimates, the share of companies missing fundamentals is at its lowest level since 2021. That improvement is not driven solely by blockbuster results from Big Tech: Seaport Research Partners finds that issuers outside the IT sector have produced the largest positive surprises since Q4 2024.

The Magnificent Seven's reaction to earnings has been mixed. Alphabet's report produced a record one-day market-cap gain for the company. By contrast, investor disappointment at Meta Platforms sent its shares tumbling, creating a $566 billion gap in market capitalization among the group.

Magnificent Seven's reaction to earnings

High profits and discounted fundamental valuations are not the only drivers of the S&P 500's run to record highs. Oil has eased on reports that Iran made a new proposal to the US to unblock the Strait of Hormuz, and President Donald Trump has launched "Project Freedom," which is said to help commercial vessels find the safest transit routes through the world's key oil artery.

De-escalation in the Middle East would be an obvious positive for US equities, while escalation would hit the S&P 500.

US economic reports are also delivering pleasant surprises. After GDP expanded 2% in Q1, the manufacturing activity index — anchored near its 2022 highs — signals that the US economy is in decent shape.

Nevertheless, Goldman Sachs issues a warning for US equities. Its research shows hedge funds and trading advisors have begun to reduce net purchases. Coupled with stretched bullish positioning in the S&P 500, that raises the odds of a pullback. The bank believes the market will let off steam in the near term, shedding some of the froth accumulated during the rally to record highs.

Technically, the daily S&P 500 chart could be forming a reversal pattern centered on a bar with a long upper shadow. Closing the gap with a drop below 7,220 would provide a basis for initiating short-term short positions.