Forex News
- Dow Jones futures rise after reports that Iran’s Araghchi signaled negotiation approval to Netanyahu.
- Traders remain cautious as US warships and thousands of Marines are set to arrive in the Middle East on Friday.
- Traders focus on the flash S&P Global US PMI for March, due on Tuesday.
Dow Jones futures inch higher 0.9% to above 46,550 during European hours on Tuesday, ahead of the US cash market open. Meanwhile, S&P 500 and Nasdaq 100 futures gains 0.14% and 0.23% to near 6,650 and 24,460, respectively, at the time of writing.
US stock futures rise after Al Arabiya reported on X, citing Yedioth Ahronoth sources, that Iran’s Foreign Minister Araghchi secretly conveyed approval for negotiations to Israeli Prime Minister Benjamin Netanyahu, with the Supreme Leader reportedly open to talks with the US.
However, traders are likely to remain cautious as additional US warships and thousands of Marines are expected to arrive in the Middle East on Friday, the deadline set by Trump for a ceasefire and negotiations.
US stock futures struggled earlier in the day as geopolitical risks have intensified as US-aligned Gulf states move closer to direct involvement in the Iran conflict. Potential attacks on critical energy infrastructure would raise fears of broader regional instability.
In Monday’s US regular session, the Dow Jones and Nasdaq 100 each advanced 1.38%, while the S&P 500 climbed 1.15%. The gains followed Trump’s decision to delay planned strikes on Iranian energy infrastructure by five days, citing ongoing productive talks. Traders now turn their attention to the flash S&P Global US PMI for March, due later in the day, for fresh clues on economic conditions.
Dow Jones FAQs
The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500.
Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.
Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits.
There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.
ING economist Chris Turner notes EUR/GBP remains offered despite sharp declines in UK short‑dated rates, with clear technical support at 0.8600/0.8620 that markets expect to hold. He argues the bar for a Bank of England (BoE) hike is very high, warns weak UK PMIs could weigh on Sterling, but still assumes the 0.8600/0.8620 area will contain EUR/GBP downside.
Sterling firm as BoE bar stays high
"Even though UK short-dated interest rates had some of the biggest adjustments lower yesterday, EUR/GBP remains surprisingly offered. Clear support is defined at the 0.8600/8620 area, which we – and probably the rest of the market – expect to hold. That is the same for the FX option market, where the EUR/GBP one-month risk reversal – or the price of a call option over an equivalent put option – remains bid at its recent highs of 0.8%."
"Our UK economist also feels the bar is exceptionally high for the Bank of England to hike the already restrictive policy rate, and it may well be that softer activity data takes some of the sting out of BoE tightening expectations."
"A big drop in some of the March flash UK PMIs today could weigh a little on sterling, although we should be wary of comments from Bank of England arch-hawk, Huw Pill, at 1430CET today. He could well say he plans to vote for an April hike."
"Our baseline assumes 0.8600/8620 does contain EUR/GBP downside."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Danske Research Team notes softer Japanese data, with composite PMI slipping and core CPI falling below target for the first time in four years, largely due to fuel subsidies. Despite this, PMIs show rising input prices and a weak Japanese Yen. Danske Bank expects the next Bank of Japan rate hike in April, with markets pricing roughly a 50% probability.
Soft inflation but hike still in view
"In Japan, data has come in on the soft side, with composite PMI at 52.5 down from 53.9, driven by both manufacturing and service."
"CPI inflation, excluding fresh food, declined to 1.6% in February from 2.0%, marking the first time below the inflation target in four years."
"Fuel subsidies is a key driver, and the reality has changed a lot since February as PMIs reveal a marked increase in firms' input prices and the yen remains under pressure."
"We expect the next BoJ hike in April."
"Markets are pricing close to 50-50 for that."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
ING’s Chris Turner notes the Dollar has softened after comments on possible negotiations with Iran, but sees limited downside while the Strait of Hormuz remains shut and energy prices are elevated. He argues DXY has stalled near the top of its nine‑month range and expects the Dollar to stay in a 99.00–100.00 band absent fresh Middle East developments.
Dollar capped near recent range highs
"Iran has leverage with the Strait of Hormuz, however. For another big leg higher in risk assets to occur, we probably need to hear something positive from the Iranian side. News from the US that envoys are being sent for negotiations in Pakistan may not be enough to trigger another significant drop in the dollar."
"Beyond the inevitable set of Middle East headlines today, the US macro focus will be on the weekly ADP jobs report (any job losses yet?), and the provisional March PMI releases. It may be a little too early for the PMIs to come lower, but clearly an energy supply shock will inevitably take its toll on business sentiment."
"DXY has recently stalled at the top of the nine-month range near 100.25/50. We think its medium-term upside is limited unless energy prices make another major move higher or challenges emerge in financial plumbing, such as the cross-currency basis swaps moving wider (briefly seen yesterday) as banks use the FX swap market to secure dollar funding in wholesale markets."
"99.00-100.00 may be the near-term range until we see the next decisive chapter in this Middle East conflict."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- Silver bounces back as the US Dollar drops; however, its outlook remains uncertain.
- US President Trump pauses military strikes on Iran's power plants for five days.
- Iran dismisses direct talks with the US on de-escalating Middle East war.
Silver price (XAG/USD) recovers its early losses and turns positive to near $69.70 during the European trading session on Tuesday. The white metal bounces back strongly as the US Dollar (USD) surrenders its early gains.
As of writing, the US Dollar Index (DXY), which tracks the Greenback's value against six major currencies, trades flat around 99.20 after giving back early gains.
Technically, a falling US Dollar makes the Silver price an attractive risk-reward bet for investors.
However, the outlook of the Silver price remains uncertain as Iran denies involvement in talks with the United States (US) regarding the resolution of the war in the Middle East, a scenario that might keep the US Dollar on the frontfoot.
Theoretically, signs of geopolitical tensions remaining heightened tend to increase the safe-haven appeal of precious metals, such as the Silver. However, precious metals are underperforming as surging energy prices due to Middle East conflicts have weakened speculation that major global central banks will cut interest rates this year. A hawkish stance or an extended pause on interest rates by global central banks bodes poorly for non-yielding assets, such as Silver.
Iranian officials downplayed the prospect of negotiations with the US after Parliament Speaker Mohammad Bagher Ghalibaf said no talks have been held with it. Also, Iran’s Foreign Ministry reiterated that its stance on the Strait of Hormuz and conditions to end the war remain unchanged, adding that Tehran has not responded to messages relayed by other countries regarding US requests for talks, according to IRNA.
Before Iran's clarification on news claiming its involvement in negotiations with the US, President Donald Trump announced through a post on Truth.Social that he has instructed the Department of War to pause scheduled military strikes on Iran'ss power plants for five days, as Washington had very good and productive conversations with Tehran regarding a complete and total resolution of our hostilities in the Middle East.
Silver technical analysis
XAG/USD trades higher at around $69.70 during the press time. However, the near-term bias is bearish as spot holds well below the 20-day Exponential Moving Average (EMA), which now tracks near $78.67 and caps recovery attempts. Price has broken a sequence of higher daily closes and is extending away from the 20-day EMA, reinforcing downside pressure.
The 14-day Relative Strength Index (RSI) at 35.33 sits near oversold territory and confirms persistent selling momentum rather than exhaustion.
Initial resistance emerges at the 20-day EMA around $78.67, and a daily close above this level would be needed to ease immediate downside pressure. Above there, the $83.00 region, tied to recent consolidation before the latest breakdown, marks a secondary barrier. On the downside, major support sits near Monday's low at $61.01, with a break exposing the next bearish target toward the October 16 high of $54.86.
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
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