Middle East tensions escalated sharply as the US launched a third night of airstrikes on Iran. Iran retaliated by striking US military bases in Kuwait, Bahrain, Jordan, Oman and Qatar. This direct US-Iran confrontation is sending shockwaves through global forex markets. The Strait of Hormuz crisis threatens 20% of global oil supply. Safe haven currencies surged with the dollar index breaking above 105.50. Gold jumped to $2,385. The yen strengthened 1.2% while high-risk currencies like the Australian dollar fell to 0.6680. Oil prices surged with Brent crude reaching $78.14 per barrel. The Canadian dollar was supported by rising oil prices.
Forex Market Impact
The immediate impact on forex markets has been significant. Safe haven currencies have strengthened while risk currencies have fallen. Oil prices have surged benefiting oil exporters. The situation remains fluid and traders should maintain defensive positioning. Key levels to watch: DXY 105.80 resistance, EURUSD 1.0800 support, USDJPY 158.00 support.