Fundamental

The short-term outlook for EUR/USD has been consistently deteriorating since the rejection from yearly peaks near the 1.2100 hurdle recorded in late January.

Spot Gold is heavily down on Tuesday, with the XAU/USD pair trading around $5,110 in the American afternoon, after briefly piercing the $5,000 mark.

AUD/USD weakens further alongside the rest of its risk-linked peers, breaching below the 0.7000 support and exposing extra weakness in the short-term horizon.

Oil’s market reaction has been immediate and sharp. The market is no longer pricing in a simple rise in tensions, but the de facto paralysis of the world’s most strategic energy corridor: the Strait of Hormuz.

Even without a confirmed, sustained disruption, the mere risk to a key global energy chokepoint is enough to inject a significant premium into European Gas markets. And for the Euro, that matters.

The EUR/USD pair pierced the 1.1600 mark on Tuesday, as risk aversion keeps fueling demand for the US Dollar (USD). The escalation of the Middle East crisis has finally interrupted traffic through the Strait of Hormuz, with the immediate consequence of soaring Oil prices.