On the geopolitical front, high-level talks between the US and Iran in Islamabad failed to yield any substantive breakthroughs, whilst the Trump administration has ordered a de facto naval blockade of the Strait of Hormuz—any vessel entering or leaving the area without authorisation will face interception, diversion or even seizure. Meanwhile, Iran has threatened retaliatory measures against ports in other Gulf states, significantly increasing the risk of the conflict spilling over. Although sources indicate that dialogue between the two sides is continuing, with the next round of talks expected to take place in Islamabad on 16 April, the current ambiguous state of ‘negotiations continuing but not yet concluded, blockade in place but no war yet’ is precisely the uncertainty that the market finds most difficult to price in. US Treasury Secretary Bessent has reported to President Trump that if hostilities persist for 8 to 12 weeks, the US will be exposed to extreme vulnerability regarding rising petrol prices; this internal assessment also explains, in part, why the US maintains diplomatic channels whilst enforcing a hardline blockade. Citigroup, however, offers a relatively measured perspective: even if a prolonged disruption to supplies through the Strait of Hormuz were to push oil prices to $100 per barrel, the global economy’s resilience has significantly improved—with household and corporate balance sheets in healthier shape than before, raising the threshold for an economic recession. This view has, to some extent, alleviated the market’s extreme panic over the prospect of oil prices soaring indefinitely.

US existing home sales figures for March were markedly weak, with an annualised rate of 3.98 million units—the lowest level since June 2025—representing a 3.6% month-on-month decline. This data reflects the convergence of three pressures: a persistent shortage of housing supply, heightened uncertainty regarding the labour market outlook, and rising mortgage rates resulting from the escalation of tensions between the US and Iran. As the economic sector most sensitive to interest rates, the cooling signals from the property market have further reinforced market expectations of a slowdown in economic momentum, whilst also dampening expectations for real US dollar yields to some extent. Even more surprising to the market was the signal sent by the New York Fed. The monthly bond-buying programme was slashed from $40 billion to $25 billion, a reduction far exceeding Wall Street’s previous expectations of $5 billion to $10 billion. This move clearly indicates that, against a backdrop where inflationary stickiness has not yet fully subsided, the Federal Reserve is withdrawing liquidity support at a faster pace, even if this implies a higher tolerance for short-term volatility in financial markets. Combined with the remarks by Chicago Fed President Goolsbee—who warned that if oil prices remain above $90 per barrel for several consecutive months, this would begin to feed through to the broader price system—it is evident that the Fed’s current policy focus has shifted from ‘whether to tighten further’ to ‘the pace and duration of tightening’.

On the four-hour chart, the Bollinger Bands are narrowing and the moving averages have flattened, suggesting a potential reversal at any moment. The MACD fast and slow lines have pulled back to near the 0-line, forming a golden cross once again—a bullish signal—and there is a high probability of a breakout in the near future. The RSI stands at 56, with market participants adopting a predominantly wait-and-see approach. On the daily chart, the price has broken through the middle Bollinger Band and is currently consolidating. Should it manage to hold above the middle band, it is likely to rise again towards the 4,900 level, before falling back towards the 200-day EMA. With the RSI at 50, market sentiment remains strongly cautious. The recommended strategy is to sell on rallies.

Trading Direction: Sell

Entry Price: 4900

Target Price: 4300

Stop-loss: 5300

Support Levels: 4225, 4100, 4000

Resistance Levels: 5000, 5300, 5600