Markets were calm early Tuesday after choppy trading on Monday. Attention is on possible next talks between the US and Iran, and on Kevin Warsh\u2019s testimony as President Donald Trump\u2019s nominee to lead the Federal Reserve.<\/p>\n
Trump said on Monday that extending the US-Iran ceasefire, due to expire on Wednesday, was \u201chighly unlikely\u201d. Iran\u2019s chief negotiator and parliament speaker, Mohammed Bagher Ghalibaf, rejected talks \u201cunder the shadow of threats\u201d and said Iran was preparing \u201cto reveal new cards on the battlefield\u201d.<\/p>\n
US media reported that Vice President JD Vance is set to travel to Pakistan on Tuesday. Iran had not confirmed whether it would send a delegation.<\/p>\n
The US Dollar Index was slightly higher above 98.00 in the European morning. The US Census Bureau will release March Retail Sales later, while US stock index futures were flat after Wall Street closed lower on Monday.<\/p>\n
UK ILO unemployment fell to 4.9% in the three months to February from 5.2%, versus a 5.2% forecast. Average Earnings Excluding Bonus eased to 3.6% from 3.8%, with GBP\/USD near 1.3520 and March CPI due early Wednesday.<\/p>\n
EUR\/USD traded below 1.1800 ahead of Germany\u2019s April ZEW sentiment survey. USD\/JPY held near 159.00 as Japan\u2019s finance minister repeated readiness to act if needed, while gold traded below $4,800.<\/p>\n
Looking back at this time last year, we saw how markets were coiled with tension over the US-Iran ceasefire deadline and a pending change in Fed leadership. This period in April 2025 serves as a clear reminder of how geopolitical and monetary policy risks can build simultaneously. The lessons we learned from the subsequent market moves are directly applicable to the uncertainties we face today.<\/p>\n
The threat of the US-Iran ceasefire expiring, which we recall did cause a short-term spike in oil prices, is a textbook example of headline-driven volatility. In the two weeks that followed in 2025, Brent crude futures saw their implied volatility jump by 15% as traders priced in the risk of conflict. This shows how quickly options premiums can inflate on assets directly exposed to geopolitical deadlines.<\/p>\n
Given current tensions surrounding global shipping lanes, we should apply this lesson by looking at strategies that profit from a potential rise in volatility. For derivative traders, this means considering long straddles or strangles on energy sector ETFs, which can pay off if a sudden event causes a large price swing in either direction. This is a purer play on uncertainty rather than trying to guess the outcome of complex negotiations.<\/p>\n
We also remember the uncertainty surrounding Kevin Warsh\u2019s Fed testimony in April 2025, which kept the US Dollar Index propped up. That event drove front-month volatility on dollar-linked currency pairs higher, as his perceived hawkish stance signaled a stronger-for-longer dollar. Ultimately, the dollar index did rally to over 100 later that summer, validating the market’s initial concerns.<\/p>\n
Today, as we await fresh inflation data, we see a similar setup where the market is sensitive to any data that could alter the Fed’s path. Traders should consider using options on currency futures to hedge against a hawkish surprise that could strengthen the dollar. Buying simple put options on the EUR\/USD or call options on the USD\/JPY provides a defined-risk way to position for renewed dollar strength.<\/p>\n
The sideways action in USD\/JPY near 159.00 last year, despite warnings from Japanese officials, showed us that verbal intervention has its limits. The fundamental driver, the interest rate differential between the US and Japan, eventually pushed the pair significantly higher in the second half of 2025. This was a classic case of fundamentals overriding government rhetoric over the medium term.<\/p>\n
Gold\u2019s inability to rally back then, even with geopolitical risk, was a crucial tell. It struggled below $4,800 an ounce because the market was more focused on the prospect of a strong dollar and higher US interest rates. This reminds us that gold’s performance is often dictated more by monetary policy expectations than its traditional safe-haven status.<\/p>\n","protected":false},"excerpt":{"rendered":"
Markets steady Tuesday as investors watch US-Iran ceasefire uncertainty and Kevin Warsh\u2019s Fed nomination testimony.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-45477","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/45477","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=45477"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/45477\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=45477"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=45477"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=45477"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}