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06.04.202614:38 Forex Analysis & Reviews: Euro prefers diplomacy

Relevancia 07:00 2026-04-11 UTC--4

"Go to the Strait and just take it! Or buy from the US, we have plenty!" That was Donald Trump's advice to Asia and Europe. However, they have a different view. France and the UK are aiming to reopen the world's main oil artery through diplomacy — by lifting sanctions and signing agreements with Iran. Rising traffic through the strait, together with rumours of a 45?day ceasefire between Washington and Tehran, are supporting the EUR/USD pair.

Roughly the same number of tankers are transiting the Strait of Hormuz as at the start of the Middle East conflict in early March. These are not only Iranian vessels but ships from other countries that have struck undisclosed deals with Tehran. Most likely, transit fees are being levied. This is simply a form of control.

At the same time, Iran continues strikes on Gulf states' energy infrastructure, ignoring Donald Trump's new ultimatum. If the Middle East conflict ends now, it would leave Tehran stronger than before the war — no matter how often the US president says reconstruction will take decades.

S&P 500 weekly trading features

Exchange Rates 06.04.2026 analysis

Hopes for an S&P 500 gap up on rumors of a 45-day ceasefire and increased traffic through the world's main oil artery have allowed EUR/USD bulls to counterattack. However, Iran's disregard for Trump indicates that the conflict is far from over. Seasonality is also at work: indices and the euro tend to rise early in the week and fall later as investors close positions ahead of the weekend.

This EUR/USD pattern has persisted for three weeks, but the current episode could play out differently. The pair will be sensitive to expectations for US inflation data for March: Bloomberg consensus forecasts a 1 percentage-point rise in CPI, the largest increase since 2022.

Dynamics of US inflation

Exchange Rates 06.04.2026 analysis

Exchange Rates 06.04.2026 analysis

There is a risk that core inflation will follow headline CPI higher via second-round effects. That would raise the probability of Fed tightening in 2026. Currently, the futures market prices in a 79% chance that the federal funds rate will be held through year-end and a 10% chance of a rate hike. Any upward revision to that latter probability would support further dollar strength versus major currencies.

Technically, the daily chart shows that EUR/USD is attempting to recover after a failed lower break and a breakout of the inside bar's upper boundary. Momentum remains bearish. A retreat from 1.1585 or 1.1625 would justify selling. Likewise, a fall below the fair-value level of 1.1525 would support short entries.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Marek Petkovich,
Analytical expert of InstaSpot
© 2007-2026
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