Market Sector Scanner: Iran Tensions Rise as Gold Gains and Global Markets Face Pressure
Geopolitical tensions have lifted gold and the U.S. dollar while pressuring global equities. With Friday’s U.S. Nonfarm Payrolls ahead and markets watching developments in Iran, volatility may stay elevated across forex, stocks, and commodities, creating short-term trading opportunities.
Geopolitical tensions increased after reports of a U.S.–Israeli strike on Iran, pushing oil, gold, and the U.S. dollar higher while global stocks fell as investors became more cautious. Strong U.S. consumer confidence was outweighed by higher-than-expected inflation data, raising fears that interest rate cuts could be delayed. Even with good earnings from NVIDIA, U.S. stocks struggled due to tariff concerns and uncertainty about AI, while Bitcoin stayed weak after its recent drop.
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Key Events Calendar for February 23 – February 27
Forex Market
USD/JPY
Last Week Recap
USD/JPY had a strong week as expectations grew that the Japanese government may delay further interest rate hikes, surprising some market participants.
Technical Picture
The 10-day moving average is now acting as support, with 152 holding as an important level. There is still room for further upside toward the upper Bollinger Band.
Outlook This Week
The U.S. dollar remains firm, but with intervention risk increasing above 158, large gains may be limited. In the short term, range trading between 155 and 158 may be the better strategy.
GBP/JPY
Last Week Recap
Yen weakness helped GBP/JPY break its recent downtrend and move higher last week. With limited UK data, market focus shifted to the impact of new Prime Minister Takaichi on the yen.
Technical Picture
The rebound from the yearly lows pushed GBP/JPY back toward the middle of the Bollinger Band. The short-term outlook has turned more positive, with the 10-day moving average now pointing higher.
Outlook This Week
GBP/JPY remains well below its yearly highs and the upper Bollinger Band, leaving room for further upside. As long as price holds above the 10-day moving average, focusing on buying opportunities may be the better strategy.
EUR/USD
Last Week Recap
EUR/USD found support near its February lows in a quiet week, with higher-than-expected U.S. inflation data having only a limited impact on price action.
Technical Picture
Low volatility has caused the Bollinger Bands to narrow significantly. The lower band recently provided support, and prices have now moved back above the 10-day moving average, breaking the recent short-term downtrend.
Outlook This Week
With the U.S. dollar strengthening early this week following news of the U.S. attack on Iran, focusing on selling into strength may be the better strategy in the days ahead.
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Equities
U.S. Stock Market
Last Week Recap
The Nasdaq resumed its February downtrend despite strong earnings from NVIDIA, as concerns about AI disrupting existing business models and higher-than-expected U.S. inflation data weighed on sentiment.
Technical Picture
The index is trading near the middle of the Bollinger Band, and the 10-day moving average is flat, offering little clear direction as investors remain cautious about buying.
Outlook This Week
The weekend U.S. strike on Iran may keep the market under pressure and lead to a retest of the February lows. However, unless the conflict escalates further than expected, any weakness could present a short-term buying opportunity, as the broader market remains range-bound.
Commodities
Gold
Last Week Recap
Gold moved higher throughout last week, breaking away from the $5,000 level as tensions in Iran increased. Prices then surged further following the weekend U.S. attack on Iran. With equities moving sideways and geopolitical risks elevated, demand for gold remains strong.
Technical Picture
The 10-day moving average has resumed its uptrend, and the market now looks set to test the historic highs from earlier this year. Short-term resistance sits near the upper Bollinger Band, which may slow the rally rather than signal a selling opportunity given the strength of the trend.
Outlook This Week
The outlook remains very positive for gold, so focusing on buying opportunities continues to make sense. Volatility is high, however, so buying on pullbacks may be a better approach than chasing sharp moves higher.
Friday’s U.S. jobs report will be the key economic event this week. At the same time, markets will closely watch developments in Iran to see whether the conflict leads to more selling of risk assets or remains limited with only a small broader impact.
