How The Day Played Out
US stock markets were closed on Monday to mark the Memorial Day holiday, which meant the New York session was effectively absent from today's trading. That reality shaped everything: volumes were light across all instruments, price action was driven entirely by the London session and Asian carry-through, and moves that might otherwise have been tested and challenged into the US afternoon were instead left to sit. It was a one-session day, and the dominant narrative was geopolitical.
The relief in markets was palpable as Asia began the week with news that the US and Iran are inching toward a deal. Global stocks climbed to approach a record high as crude oil fell on optimism a deal will help reopen the Strait of Hormuz. The dollar weakened. Japanese government bonds rallied.
Secretary of State Marco Rubio struck a cautiously upbeat tone, saying the US was going to give diplomacy every chance. "We thought we might have some news last night," he said in New Delhi. "Maybe today."
That tone set the early session well. However, the optimism did not go unchallenged. Iran and the United States played down hopes for an imminent breakthrough in the three-month-old war, with Rubio saying there will either be a good agreement or Washington would deal with the country "in another way." Rubio told reporters that the US would give diplomacy every chance to succeed before exploring "alternatives."
Disputes over language on Iran's nuclear program and the lifting of sanctions have held up finalisation of a deal, according to US officials, though there is optimism that differences will be resolved relatively soon. The presence of an Iranian delegation in Qatar on Monday, including senior members of Tehran's negotiating team, was noted as a positive sign, with Qatar's mediating abilities cited.
The two sides remain at odds on several difficult issues, including Iran's nuclear ambitions, Israel's war in Lebanon with Hezbollah, and Tehran's demands for the lifting of sanctions and the release of tens of billions of dollars of Iranian oil revenues frozen in foreign banks.
WTI staged a modest rebound in European trading, with Iran's Foreign Ministry remarks raising concerns over the potential peace deal and the reopening of the Strait of Hormuz, helping crude find some demand. The picture across the FX complex was clear in its direction: the dollar index slipped to around 99 on Monday, pulling back from six-week highs as growing optimism over a potential US-Iran agreement eased concerns about inflation and interest rate hikes. Investors focused on upcoming PCE inflation data for further clues on the Fed's policy outlook. Trading activity remained subdued with US markets closed for the public holiday.
The hawkish Fed backdrop did not disappear entirely. Investors also continued to assess the outlook for Federal Reserve policy after Governor Christopher Waller signalled he no longer believed the central bank should retain an easing bias in its policy statement. Markets continue to broadly expect rates to stay unchanged through the remainder of the year, although traders are currently pricing in roughly a 40% probability of a 25 basis-point rate increase in December.
The session closed with the Iran deal still unresolved, the $90 level on WTI tested but not broken to the downside in a sustained way, and the dollar modestly weaker. The geopolitical premium in energy was partly removed but not eliminated. Both sides confirmed what the morning briefing warned: the deal is not done, and fragility remains the operative word.
Key Moves And Levels
WTI CRUDE OIL. WTI crude futures dropped about 5% toward $91 per barrel on Monday, extending last week's decline as the US and Iran moved closer to a deal. The current price sits at approximately $92.07, with a previous close of $96.60. Today's range ran between $91.31 and $93.54. The $90.00 level that the morning briefing identified as the critical psychological floor was tested intraday but not cleanly broken. The broken triangle support could flip into resistance on any relief rallies, attracting fresh sellers. The 100 SMA has crossed below the 200 SMA, confirming that the path of least resistance is to the downside. A move that began last week has now extended to a cumulative decline of more than 8% from the $96.60 Friday close.
GOLD (XAU/USD). Today's range ran from $4,509.38 to $4,579.68, with the opening price at $4,509.38. The current exchange rate is approximately $4,556.53, with a previous close of $4,509.38. Gold found a bid as the dollar softened on deal optimism but ran into resistance ahead of the $4,580 level. Gold edged lower during parts of the day as the dollar recovered some ground amid doubts that the US and Iran could reach a deal, with XAU/USD trading around $4,518 at one point, down 0.50%. The $4,460 structural support level identified in this morning's briefing was never tested today. The triangle pattern in gold remains unresolved. The important $4,460 level remains the line that must hold for the bullish case to stay intact.
SILVER (XAG/USD). Silver rose to $77.66 per troy ounce on May 25, 2026, up 3.07% from the previous day. Today's range ran from $75.5150 to $78.8360, with the opening price at $75.5150. Silver climbed toward $78 an ounce, recovering losses from last week as increasing optimism over a potential US-Iran agreement eased concerns about inflation and interest rate hikes. Reports indicated that the proposed deal could reopen the Strait of Hormuz, end hostilities, and release some frozen Iranian assets. The $79.00 resistance level from the morning briefing was approached but not closed above. Support at $76.00 held comfortably throughout the session.
USD/JPY. USD/JPY traded around 158.90 during the Asian hours, maintaining downward momentum as the Japanese yen gained support from falling oil prices amid growing signs that the US and Iran are moving closer to a diplomatic agreement. Yahoo Finance data shows USD/JPY at 158.89, down 0.16% on the session. The 157.50 support level from this morning's briefing was not tested. The pair continues to orbit just below the 159-160 zone. Traders remain on high alert as the pair moves within proximity of the 160.00 critical level, widely considered a "line in the sand" where Japanese authorities are expected to intervene. Finance Minister Satsuki Katayama said last week that Japan stands ready to act against excessive foreign exchange volatility at any time.
GBP/JPY. GBP/JPY traded around 213.72, with a fractional gain on the session. Later data shows the pair at approximately 214.58, up 0.36%. The pair held well within the 211.50-215.00 range flagged this morning. With yen drift modest and sterling steady, the pair did precisely what the morning briefing anticipated: it ranged without conviction.
EUR/USD. EUR/USD retraced from 1.1650 in European trading, reversing gains as optimism faded over a potential US-Iran peace deal, with markets turning cautious and reviving safe-haven demand for the US dollar. EUR/USD was quoted around 1.1629. The pair traded at 1.1648, up 0.37% on the day. EUR/USD did breach the 1.1600 threshold from the upside and printed above 1.1650 intraday, satisfying the morning's early warning condition for risk-on continuation. However, the pair could not hold those gains into the end of the London session, closing back toward 1.1630-1.1648 territory. The 1.1576 multi-week low support held well below.
USD/CAD. USD/CAD edged lower to around 1.3805 during the early European session as the dollar softened after US officials signalled progress on a peace deal with Iran. Trading volumes were expected to be light due to the US Memorial Day market closure. The prior close was approximately 1.3820. The morning briefing's neutral-to-mildly-bullish USD/CAD bias did not play out forcefully, with the oil sell-off being largely offset by broader dollar weakness.
USD/CHF. USD/CHF traded at 0.7861, down 0.04% on the session. The pair held within its established range. The 0.7880 entry level from the morning briefing was not triggered. As anticipated, with risk-on sentiment dominant and safe-haven CHF demand subdued, the pair simply consolidated. It remains the quietest instrument of the day.
Morning Calls Review
The morning briefing deserves an honest assessment. It performed well on the primary instruments and correctly identified the session's character.
WTI CRUDE OIL. The bearish directional bias was correct. WTI fell as predicted, traded down toward and around the $91-$92 zone, and tested the $90.00 level intraday without breaking it on a sustained basis. The morning's call to wait for a retest of broken support rather than chasing the extended move was validated: the pair found a bid once it probed $91.25. The $90.00 level as the key watch point was precise.
SILVER (XAG/USD). The cautiously bullish bias was correct. The pair bounced from close to the $76.50 pullback entry level suggested in the morning's execution guidance, reached the $78.50-$78.84 area, and traded in the direction called. The morning explicitly warned against buying into extended strength and instead flagged a pull-back entry around $76.50. Those who waited for that opportunity found it in the early London session as silver consolidated before resuming higher. The risk-defined structure worked.
EUR/USD. The cautiously bullish intraday call was partially correct. EUR/USD did breach 1.1600 with conviction and printed 1.1650 intraday, confirming the risk-on signal from the morning. However, the pair was unable to sustain above 1.1650 and closed back in the 1.1630-1.1648 range. The call to look for a hold above 1.1600 before adding exposure was the right filter. Those who used 1.1600 as the trigger had a clean entry and could bank partial profit on the 1.1650 test.
USD/JPY. The bearish bias was directionally correct but the magnitude was modest. The pair moved from approximately 157.97 at the morning open down through 158.88 - note that this represents the pair actually settling higher than the open, which reflects that the yen did not see the decisive strengthening the briefing anticipated. The extreme CFTC short positioning in JPY was not triggered into a violent unwind today. No intervention occurred. The morning's guidance to avoid aggressively shorting near 157 and to look for consolidation entries rather than breakout chases was the right call, as the range remained orderly.
USD/CHF. The low-conviction neutral call was correct. The pair consolidated exactly as described. The 0.7880 entry structure was not triggered. No harm done from patience.
Positioning Into Tomorrow
The central overnight risk is the Iran deal. Disputes over language on Iran's nuclear program and the lifting of sanctions continue to hold up finalisation, though the presence of the Iranian delegation in Qatar on Monday was taken as a constructive sign. Any overnight development - whether a formal announcement or a collapse in talks - will move all instruments sharply at the Tuesday open. Traders should have pre-planned scenarios for both outcomes before going to sleep.
"Fundamentally, there is no change to the underlying picture, where 10-11 million barrels per day of crude oil continue to be shut-in for every day the Strait of Hormuz remains shut," one senior analyst noted. Markets are expecting a rush of approximately 100 million barrels of crude oil from stranded ships to flow out once any deal is in place. That means if a deal is confirmed overnight, WTI could gap significantly lower at Tuesday's open. Size accordingly.
The US market returns in full tomorrow after the Memorial Day closure. Tuesday will restore full New York session liquidity and volume to all instruments. Any gaps opened at the Asian or London open tomorrow will face the full test of US participation. Expect expanded ranges across WTI, gold, and the dollar pairs.
The week's defining data release is approaching: the April Personal Income and Outlays report, which contains the April PCE inflation print, is due on 28 May at 8:30 a.m. EDT. For context, the March PCE price index rose 3.5 percent year-on-year, while the core PCE excluding food and energy rose 3.2 percent from one year ago. A print that meets or exceeds those levels would add fresh fuel to the hawkish Fed repricing narrative and would reassert dollar bid across the board, pressure gold through $4,460, and potentially bring USD/JPY back toward the 160.00 intervention zone. A softer reading would support risk assets and extend the de-escalation trade.
For Tuesday specifically: watch whether WTI can hold above $90.00 once full US liquidity returns. Watch EUR/USD for whether the 1.1650 level is recaptured cleanly on the New York open or remains a capped resistance. Watch USD/JPY - the pair has been drifting back toward 159, and any Iran deal confirmation overnight could see yen strength via carry unwind. US first-quarter GDP data and initial jobless claims are also due on 28 May.
Markets Mastered - Today's Takeaway
Today proved that a headline-driven session without full US liquidity produces directional moves that lack follow-through - the plays worked, but the ranges were contained. The morning briefing's most valuable contribution was not the directional calls but the discipline framework: reduced size, wider stops, and patience for pullback entries rather than chasing extended moves. The $90.00 level on WTI held as the line in the sand for now, but the technical picture is deteriorating, and a close below that level on Tuesday with full US volume would be a meaningful signal for further downside. The week ahead is defined by Thursday's April PCE print: everything from the Iran deal to Fed pricing to gold's triangle resolution will crystallise or collapse around that single number.