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Risk Appetite Edges Up Amid Lingering Mideast Volatility

(By ATFX Analyst Team)

Summary

  • Geopolitical Tensions: Middle East tensions remain high as Iran denies earlier reports of a willingness to negotiate.
  • US Economic Data: The Fed’s Beige Book shows slight growth with persistent inflation and steady hiring. February services activity hit a 3.5-year high, while ADP payrolls (+63k) beat estimates.
  • Key Focus Today: Markets eye a rebound in Eurozone Jan Retail Sales (est. 1.7% YoY) and US Initial Jobless Claims, projected at 215k.

 

Global Market Overview 05/03/2026

U.S. stocks closed higher Wednesday—with the Dow ending up 0.49%, the S&P 500 gaining 0.78%, and the Nasdaq rising 1.29%—as Donald Trump’s pledge to stabilise oil markets and reports of Iran’s willingness to negotiate eased fears of conflict escalation and inflation. While U.S. Treasury yields rose for a third day, the dollar retreated from multi-month highs as investors weighed inflation risks and the future of monetary policy following the oil price spike. Meanwhile, gold climbed 1.0% to $5,135.32 per ounce on safe-haven demand and a cooling dollar, while oil prices remained volatile and trending upward amid intensifying U.S. and Israeli strikes against Iranian targets.

 

Key Events Today:

  • 18:00 EU Retail Sales JAN **
  • 21:30 US Initial Jobless Claims ***

 

Tomorrow:

  • 15:00 EU GERMANY Factory Orders JAN MoM **
  • 18:00 EU GDP Growth Rate YoY 3rd Est Q4 ***
  • 21:30 US Non-Farm Payrolls FEB ***

 

Markets Analysis 05/03/2026

20260305 EURUSD Keys Instruments

  • Resistance: 1.1711/1.1771
  • Support: 1.1578/1.1520

EUR/USD rose 0.2% to 1.1632 as the USD softened amid signals of potential Iran negotiations. However, the pair remains pressured by high energy costs and gas supply fears, with the options market maintaining its strongest bearish stance in a year.

Analyst View: The pair is trading within a descending channel and recently staged a minor bounce from the 1.1578 support zone. Despite the daily gain, the overall structure remains bearish as the price is capped by the descending trendline and the 1.1711 resistance area.

Bias: Mildly Bearish below 1.1700.

20260305 GBPUSD Keys Instruments

  • Resistance: 1.3481/1.3544
  • Support: 1.3281/1.3218

GBP/USD ticked up 0.1% as the USD retreated from recent highs. Concerns over persistent UK inflation and the impact of rising long-term energy costs on the British economy limited gains.

Analyst View: The pair is trading within a well-defined descending channel and recently tested the lower support boundary near 1.3218. While a minor recovery is underway, price action remains capped by the descending trendline and the 1.3481 resistance zone, maintaining a generally bearish structure.

Bias: Mildly Bearish below 1.3400.

20260305 USDJPY Keys Instruments

  • Resistance: 157.66/158.29
  • Support: 156.24/155.60

USD/JPY fell 0.4% to 157.02 as the USD weakened on reports of potential Iran-CIA diplomatic channels. Market sentiment improved slightly, reducing safe-haven USD demand, though the Yen remains sensitive to regional escalations.

Analyst View: The pair is trading in an uptrend and recently pulled back from its multi-month highs. While it is currently finding support near the 156.24 zone, the immediate upward momentum has stalled, and a decisive break below 155.60 could signal a more significant correction within the uptrend structure.

Bias: Mildly Bullish above 156.30.

20260305 US Crude Oil Futures (APR) Keys Instruments

  • Resistance: 77.44/78.74
  • Support: 73.13/71.80

WTI jumped 1.75% to $76.11, a multi-month high. Supply fears persisted as the Hormuz Strait remained paralyzed. While Iraq’s production cuts supported prices, Trump’s pledge to escort tankers and potential Iran negotiations capped gains in the session.

Analyst View: Prices are in a powerful breakout phase, trending higher within a steep ascending channel. The current price action indicates dominant bullish control; a decisive move above 77.44 could pave the way for a move toward the $80.00 psychological level. The overall structure remains positive as long as the 71.80 support zone holds.

Bias: Watch for High-Level Consolidation.

20260305 Spot Gold (XAU/USD) Keys Instruments

  • Resistance: 5284/5353
  • Support: 5062/4994

20260305 Spot Silver Keys Instruments

  • Resistance: 92.21/95.47
  • Support: 78.17/74.84

Gold rose 0.7% to $5120.71 as escalating Middle East conflict fueled safe-haven buying. A retreating USD provided additional support. Despite strong ADP employment data, persistent geopolitical risks maintain a broadly bullish outlook for the precious metal.

Analyst View: Gold is currently riding a wave of geopolitical momentum, showing significant strength as it holds firmly above the 5,062 support floor. Bulls remain in clear control; a decisive move through the 5,284 resistance area could spark another impulsive rally toward the 5,353 level.

Bias: Bullish if it breaks $5,200.

20260305 Dow Jones Futures Keys Instruments

  • Resistance: 49226/49472
  • Support: 48430/48188

The Dow rose 0.49% as U.S. tanker escort plans and potential negotiation news eased inflation fears. While industrial sentiment improved, the energy sector led decliners following the relative stabilization of the oil market.

Analyst View: The index is currently attempting to establish a base near the major 48,430 support level after a significant downward corrective move. Although price action has stabilized, it remains heavy under the current corrective structure. A sustained hold above 48,188 is required to build momentum for a potential relief rally.

Bias: Mildly Bearish below 49,000.

20260305 NASDAQ 100 Keys Instruments

  • Resistance: 25517/25764
  • Support: 24721/24470

The NAS100 climbed 1.29% as investors returned to tech stocks amid improved risk sentiment. Strong service sector activity and private employment data bolstered the index, successfully offsetting ongoing geopolitical uncertainty in the Middle East.

Analyst View: The index is currently in a recovery phase, showing signs of stabilization above the 24,721 support zone. While bulls are attempting to regain ground, the price action remains heavy under the 25,517 resistance barrier. A decisive break above this level is needed to shift the momentum toward a retest of the 25,764 ceiling.

Bias: Mildly Bearish below 25,200.

20260305 Bitcoin (BTC/USD) Keys Instruments

  • Resistance: 75127/76116
  • Support: 70937/69697

Bitcoin surged 7.7% on Wednesday to a one-month high of $73,488.9, breaking out of its recent tight range. The rally was driven by solid U.S. economic data, strong spot ETF inflows ($225 million on March 3), and President Trump’s vocal support for the “Crypto Agenda”.

Analyst View: Bitcoin has staged a decisive breakout, establishing a firm base above the $70,937 support zone. Regulatory tailwinds and sustained institutional demand have effectively offset geopolitical concerns, shifting the immediate technical focus toward a potential test of the $76,116 resistance level if current momentum persists.

Bias: Bullish above $70,937.

Enjoy trading! The content is for reference only. Please ensure that you understand the risk.

About the author

Martin Lam

 

Martin Lam is ATFX Chief Analyst for Asia Pacific, with over 20 years of experience in global forex and investment markets. He holds a degree in Finance and Economics from Deakin University and has held senior roles at leading FX brokerage firms.

More from Martin Lam

This market commentary and analysis has been prepared for ATFX by a third party for general information purposes only. Any view expressed does not constitute a personal recommendation or solicitation to buy or sell as it does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should therefore seek independent advice before making any investment decisions. This information has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. We aim to establish and maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of our clients. The market data is derived from independent sources believed to be reliable, however we make no representation or warranty of its accuracy or completeness, and accept no responsibility for any consequence of its use by recipients. Reproduction of this information, in whole or in part, is not permitted.

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