Oil prices have bounced up during the Asian session, as the US military announced a total blockade of the Strait of Hormuz on Tuesday, increasing the chokehold on supply and putting the new round of talks with Iran into question.
Commerzbank strategists note that Brent Oil dropped nearly 5%, reversing Monday’s gains, as hopes for a second round of US–Iran negotiations and International Energy Agency (IEA) warnings of demand destruction weighed on prices.
The USD/CHF pair trades flat around 0.7812 during the late Asian trading session on Wednesday, but is still close to its monthly low of 0.7790 posted the previous day.
EUR/USD remains calm after halting its seven-day winning streak, trading around 1.1790 during the Asian hours on Wednesday. The daily chart technical analysis indicates a bullish bias, as the pair is moving upwards within an ascending channel.
The USD/JPY pair once again shows some resilience below the 200-period Simple Moving Average (SMA) on the 4-hour chart and edges higher during the Asian session on Wednesday. Spot prices, however, lack bullish conviction and struggle to capitalize on the strength beyond the 159.00 mark.
The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is halting its seven-day losing streak and trading around 98.20 during the Asian hours on Wednesday.
US President Donald Trump said in an ABC News interview on Wednesday that he isn't thinking about extending the ceasefire, adding that he doesn't think it will be necessary.
The NZD/USD pair struggles to capitalize on its strong move up witnessed over the past two days and oscillates in a narrow band near the 0.5900 mark during the Asian session on Wednesday.
GBP/USD halts its seven-day winning streak, trading around 1.3560 during the Asian hours on Wednesday. The pair loses ground as the US Dollar (USD) edges higher despite dampened safe-haven demand amid growing market optimism amid hopes for a diplomatic solution to the Middle East conflict.
The USD/CAD pair trades slightly higher to near 1.3780 during the European trading session on Wednesday.
Silver (XAG/USD) climbs to a nearly one-month peak during the Asian session on Wednesday, though it struggles to build on the momentum further beyond the $81.00 mark.
AUD/USD gains ground for the third successive day, trading around 0.7120 during the Asian hours on Wednesday. The pair appreciates as the Australian Dollar (AUD) receives support from improved market sentiment due to the potential for further United States (US)-Iran talks.
