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21/04/2026 - 07:00 UTCThe USDX posted modest gains in Tuesday's Asian session, trading near 98.10 as markets reacted to a volatile Monday where the index fell -0.44. The Greenback is currently finding support as investors await the outcome of critical negotiations in Pakistan. US Vice President JD Vance is scheduled to lead a delegation to resume talks with Iran, though President Trump has signaled a firm stance, indicating that the current ceasefire may not be extended if a deal is not reached this week. Market participants are also pivoting toward the US March Retail Sales report due later today for further direction.
Gold met with fresh supply on Tuesday, dropping back below the $4,800 mark. This follows a strong performance on Monday where the precious metal rallied 1.4%. The current retreat is driven by a slight firming of the US Dollar and a rise in bond yields fueled by lingering inflation concerns. Despite the immediate pressure, the downside remains cushioned by rising expectations for a Federal Reserve rate cut later this year, with the FedWatch Tool now pricing in nearly a 50% chance of a reduction by year-end.
WTI Oil eased toward $85.40 on Tuesday, surrendering ground after Monday’s -2.73% decline. Prices remain subdued as traders balance the reopening of diplomatic channels against severe physical disruptions in the Strait of Hormuz. While the upcoming second round of talks in Islamabad offers a glimmer of hope for a supply resolution, the reality on the water remains tight; shipping traffic has slowed to a crawl following the US seizure of an Iranian vessel and retaliatory warning shots from Iran. Analysts note that if this blockade persists, global supply losses could become substantial, keeping the energy market on edge.
Asian markets presented a mixed performance on Tuesday, though the technology sector provided a significant boost to regional benchmarks. South Korea’s Korea 200 surged to a record high, largely driven by aggressive buying in the semiconductor space. SK Hynix led the charge, jumping 5.23% in its last session after announcing the production of advanced memory modules for Nvidia’s next-generation AI chips. Samsung Electronics also saw solid demand, rising 1.39%, as investors doubled down on artificial intelligence-linked shares.
In Japan, the Japan 225 climbed over 1%, tracking the positive momentum in tech, while broader sentiment remained cautious due to the fragile geopolitical environment. Gains across the region were capped by uncertainty surrounding the U.S.-Iran ceasefire. While reports of potential peace talks in Islamabad provided some relief, the China SSE and China SZSE both edged lower, reflecting concerns over potential supply chain disruptions and the ongoing blockade in the Strait of Hormuz.
Beyond geopolitics, traders are closely monitoring Washington for the Senate confirmation hearing of the new Fed Chair-Designate. His testimony is expected to provide critical clues regarding the independence of the central bank and the future of its balance sheet policy. While main U.S. equity indices saw their record-breaking winning streaks snap overnight, the continued resilience in the Asian tech sector suggests that the structural demand for AI infrastructure remains a primary driver for global equity markets.
As the week progresses, the focus shifts to a high-stakes combination of corporate and economic data. The "Magnificent Seven" earnings cycle kicks off with Tesla, where investors will be looking for clarity on its pivot toward specialized AI chip production and its partnership with Intel, who is also slated to report. Beyond the tech sector, the macroeconomic landscape will be defined by today’s U.S. Core Retail Sales figures, which will offer a vital pulse check on consumer resilience. Looking further ahead, the spotlight will turn to the U.K. CPI data due later this week, a release that will be essential for gauging the global trajectory of inflation and its subsequent impact on central bank policy.
The EUR/USD pair traded slightly lower near 1.1780 during Tuesday’s early Asian session, as investors remained cautious over ongoing tensions in the Middle East ahead of the expiration of a 14-day ceasefire agreement.
Market participants are now turning their attention to key economic data due later in the day, including the ZEW Economic Sentiment surveys from Germany and the Eurozone. In the United States, traders will also monitor the release of March Retail Sales figures.
Sentiment remains fragile after US President Donald Trump delivered mixed signals regarding the conflict with Iran, stating he is in no rush to end the war while also expressing optimism that fresh negotiations with Tehran could begin soon in Pakistan. The current ceasefire is scheduled to expire on Wednesday.
Meanwhile, Iranian officials pushed back against Washington’s stance. Parliament Speaker Mohammad Bagher Ghalibaf said Tehran would not engage in negotiations while under threat, according to reports. Iranian Foreign Minister Abbas Araghchi added that continued US violations of the ceasefire remain a major obstacle to diplomatic progress.
The uncertainty surrounding ceasefire negotiations has supported demand for safe-haven assets such as the US Dollar, putting pressure on EUR/USD.
On the monetary policy front, markets widely expect the European Central Bank (ECB) to keep interest rates unchanged at its April meeting.
Gold prices moved lower early on Tuesday as a firmer US Dollar weighed on the precious metal, while investors awaited further clarity on whether the United States and Iran will hold peace talks later this week following renewed geopolitical tensions over the weekend.
The stronger US Dollar made gold more expensive for holders of other currencies, reducing demand and limiting upside momentum.
Market sentiment remains focused on developments surrounding possible negotiations between Washington and Tehran. According to reports, Iran is considering participation in peace talks with the United States in Pakistan. The discussions come as a two-week ceasefire approaches its expiration later this week.
A successful diplomatic outcome or an extension of the ceasefire could pressure oil prices lower and stabilize broader markets. However, if negotiations fail or tensions escalate, volatility may return and boost safe-haven demand for gold.
Oil prices also declined as traders reassessed supply risks, with expectations that renewed talks could lead to increased output from the Middle East region.
Oil prices moved sideways early on Tuesday, reversing part of the strong gains recorded in the previous session, as investors grew more optimistic that peace talks between the United States and Iran could take place this week and ease supply concerns in the Middle East.
Both benchmarks had surged sharply on Monday, after Iran again closed the Strait of Hormuz and the United States seized an Iranian cargo vessel as part of its blockade on Iranian ports.
Despite those developments, traders are now focusing on the possibility that negotiations this week could lead to an extension of the current ceasefire or even a broader agreement. However, the risk of renewed conflict and continued disruptions to oil flows remains elevated.
According to reports, Iran is considering participation in peace talks expected to take place in Pakistan following diplomatic efforts by Islamabad to ease the US blockade. The blockade has complicated Tehran’s return to negotiations, while the existing two-week ceasefire is due to expire this week.
Meanwhile, shipping activity through the Strait of Hormuz — a key route for roughly one-fifth of global oil supply — remained restricted on Monday. In a further sign of market strain, Kuwait reportedly declared force majeure on oil shipments due to the blockade.
US stock futures were little changed late Monday after US 500 ended the session higher, as investors remained cautious amid rising tensions between the United States and Iran ahead of the expected expiration of the current ceasefire agreement.
Markets came under pressure after renewed uncertainty in the Middle East. Iran reportedly reclosed the Strait of Hormuz over the weekend, while mixed signals emerged over possible peace talks expected in Pakistan. The United States also seized an Iranian cargo vessel, prompting threats of retaliation from Tehran and adding to investor concerns.
Investor attention is now centered on planned diplomatic talks in Islamabad on Tuesday, where US officials are expected to hold a second round of discussions aimed at easing tensions.
However, uncertainty remains elevated after Iranian officials stopped short of confirming their participation.
Beyond geopolitical developments, traders are also monitoring Washington, where the confirmation hearing for Federal Reserve chair nominee Kevin Warsh is scheduled this week.
Warsh has publicly supported central bank independence, though he has also suggested a potentially narrower policy mandate. His comments could influence market expectations for future monetary policy.
Meanwhile, investors are preparing for a busy earnings calendar that may help shape short-term market direction. Several major US companies are scheduled to report results before Tuesday’s opening bell, including UnitedHealth, Danaher, GE Aerospace, 3M, Northrop Grumman, Halliburton, and RTX Corp.
In addition to corporate earnings, markets will closely watch the release of March retail sales data on Tuesday for fresh insight into consumer strength amid rising energy costs and broader economic uncertainty.
The materials contained on this document should not in any way be construed, either explicitly or implicitly, directly or indirectly, as investment advice, recommendation or suggestion of an investment strategy with respect to a financial instrument, in any manner whatsoever. Any indication of past performance or simulated past performance included in this document is not a reliable indicator of future results. For the full disclaimer click here.
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