(By ATFX Analyst Team)
Key Takeaways
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Global Market Review 21/05/2026
After three consecutive trading days of decline, driven by developments in the US-Iran situation, strength in technology and semiconductor stocks lifted market sentiment, pushing all three major US stock indices higher by more than 1% on Wednesday. US Treasury yields gave back their gains from the previous session, while the US dollar retreated from a six-week high.
Gold prices rallied more than 1%, supported by a pullback in US Treasury yields and the dollar. Rising market expectations of an imminent US-Iran agreement to end the war in the Middle East pushed crude oil prices sharply lower. Meanwhile, it is reported that Iran has established a controlled navigation zone in the Strait of Hormuz, requiring vessels to obtain permission to pass.
Key Events Today:
- 15:30 EU GERMANY Manufacturing & Services & Composite PMI Flash MAY **
- 16:00 EU Manufacturing & Services & Composite PMI Flash MAY **
- 16:30 GB Manufacturing & Services & Composite PMI Flash MAY **
- 20:30 US Initial Jobless Claims ***
- 21:45 US Manufacturing & Services & Composite PMI Flash MAY ***
- 22:00 EU Consumer Confidence Flash MAY **
May 22nd
- 07:30 JP Inflation Rate APR ***
- 14:00 EU GERMANY GfK Consumer Confidence JUN **
- 14:00 GB Retail Sales APR ***
- 16:00 EU GERMANY Ifo Business Climate MAY **
- 22:00 US Michigan Consumer Sentiment Final MAY ***
Markets Analysis 21/05/2026
- Resistance: 1.1655/1.1676
- Support: 1.1601/1.1584
Geopolitical tensions have eased, and sources state that an ECB rate hike in June is a done deal. Yesterday’s final Eurozone April CPI data rose 3% year-on-year, matching expectations, which helped EUR/USD break further above the 1.1600 psychological level.
Analyst View: EUR/USD has temporarily pulled back from its April 7th lows but remains within a lower range. For intraday trading, whether the rebound can extend above 1.1650 will be key to building further upward momentum.
Bias: Moderate Rebound
- Resistance:1.3486/1.3519
- Support: 1.3381/1.3349
UK CPI for April recorded a slower-than-expected increase. However, PPI reached a three-year high, driven by surging energy prices, suggesting the Bank of England’s monetary policy direction still warrants further observation. Yesterday, GBP/USD rebounded to a high of 1.3460, supported by a resurgence of US dollar selling pressure.
Analyst View: GBP/USD rebounded to a four-day high yesterday. Keep an eye on its approach to the 10-day moving average resistance; whether it can break through this level near 1.3475 will determine whether it can reclaim the 1.3500 handle.
Bias: Moderate Rebound
- Resistance: 159.22/159.88
- Support: 158.55/157.88
Driven by hopes for a US-Iran peace agreement, speculation about potential intervention by Japanese authorities, and a pullback in the US dollar, USD/JPY snapped its seven-day winning streak yesterday, easing slightly from a near three-week high.
Analyst View: USD/JPY bulls appear cautious about a break below the 159 handle. In the short term, monitor whether corrective pressure builds towards support from the major moving averages on the daily chart, a zone crucial for defending the 158 level.
Bias: High-Level Correction
- Resistance: 101.32/103.31
- Support: 96.95/94.99
Optimism about a potential US-Iran agreement dragged oil prices down sharply, pushing them below the psychological $100 level. However, uncertainty over restrictions in the Strait of Hormuz continues to support crude prices.
Analyst View: Crude oil snapped its recent winning streak yesterday, recording its steepest single-day drop in two weeks. The market remains on hold as US-Iran negotiations progress. Until the situation clarifies, crude prices will likely find some support amid the caution. From a technical perspective, monitor whether prices remain under downward pressure below the major moving averages on the daily chart.
Bias: Short-Term Downward Pressure
- Resistance: 4605/4637
- Support: 4500/4468
- Resistance: 80.10/82.29
- Support: 73.58/70.84
As US-Iran negotiations showed progress, the pullback in the US dollar provided room for gold to halt its losing streak, with prices rebounding by over 1% yesterday. However, the hawkish stance revealed in the Fed minutes dampened the boost to gold from optimism over a potential US-Iran agreement.
Analyst View: After bouncing back yesterday from its lowest level since late March, gold recorded further gains this morning. However, the overall upward momentum remains relatively mild. The market is currently on the sidelines, watching for developments in the US-Iran situation. Until further positive news emerges, the rebound remains somewhat fragile.
Bias: Moderate Rebound
- Resistance: 50118/50288
- Support: 49849/49680
Signs of easing US-Iran tensions provided a crucial boost to the US stock market yesterday, sparking a noticeable recovery in market risk sentiment as investors repriced the Middle East risk premium. The Dow Jones Industrial Average crossed back above the psychological 50,000 level during intraday trading.
Analyst View: Dow recorded its largest single-day gain in two weeks, climbing back above key moving averages on the daily chart. Focus is now on a potential return to its recent high-level range. Keep an eye on resistance at 50,118/50,288; further positive news will be required to test last week’s highs.
Bias: Moderately Bullish
- Resistance: 29499/29886
- Support: 28619/28225
Positive news from the Middle East cooled the rally in US Treasury yields, helping Nasdaq snap its three-day losing streak and close over 1% higher yesterday. NVIDIA delivered better-than-expected earnings and guidance after the close yesterday; look to see whether this provides an additional tailwind to drive Nasdaq higher today.
Analyst View: Following yesterday’s rebound, Nasdaq climbed back above its 10-day moving average. To build momentum to challenge last week’s record highs, it needs to hold firmly above this level intraday. If further positive geopolitical developments emerge, a test of the 29,499/29,886 resistance zone cannot be ruled out.
Bias: Moderately Bullish
- Resistance: 78873/79808
- Support: 76084/74912
Bitcoin edged higher on Wednesday, with the world’s largest cryptocurrency aiming to snap a five-day losing streak after a U.S. legislative breakthrough, as the market pulled back.
Analyst View: After halting its five-day losing streak yesterday, BTC/USD recorded further gains this morning, moving closer to its 10-day moving average. The focus is now on whether it can overcome resistance above this moving average; a breakout would signal a potential escape from its recent low range.
Bias: Moderate Rebound
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