EUR/USD is consolidating near 1.17 after recent gains linked to easing geopolitical concerns. It entered Friday’s North American session up 0.1% against the US dollar.

Risk reversals have improved, pointing to lower demand for protection against euro weakness. This shift is described as allowing a move back towards fundamental drivers.

Near Term Drivers For Eurusd

Yield spreads are described as supportive for the euro in the near term. This is associated with upside risk for EUR/USD.

Short-term technical signals are bullish, with the RSI above 50. Earlier in mid-March, the RSI fell to near 20.

Resistance is described as limited before 1.18, which previously acted as a congestion area in the second half of February. The expected near-term trading band is 1.1680 to 1.1780.

Looking back at the bullish sentiment from 2025, the situation today is quite different. The euro is currently trading closer to 1.0850, well below the 1.1680–1.1780 range that was anticipated. This suggests that the fundamental drivers have shifted significantly over the past year.

Options Positioning And Trade Ideas

The yield spreads that were once seen as supportive for the euro now favor the US dollar. We see the spread between the US 10-year Treasury and the German 10-year Bund has widened to nearly 200 basis points amid a resilient US economy. This makes holding dollar-denominated assets more attractive for yield-seeking investors.

Recent data reinforces this divergence, with the latest US jobs report in March 2026 showing a robust gain of over 250,000 jobs, keeping the Federal Reserve on a hawkish path. Meanwhile, the European Central Bank has expressed more caution, as March inflation in the Eurozone, while ticking up to 2.6%, is coupled with weaker growth forecasts. This policy difference is putting downward pressure on the EUR/USD pair.

In the derivatives market, the optimism of 2025 has faded, and sentiment has reversed. One-month risk reversals for EUR/USD are now skewed towards puts, indicating traders are paying a premium to protect against further downside in the euro. This is a stark contrast to the softening demand for downside protection we observed last year.

Given this environment, traders should consider strategies that hedge against or profit from further euro weakness in the coming weeks. Buying EUR/USD put options with strike prices around 1.0750 or 1.0700 could be a straightforward way to position for a potential break below the 1.0800 support level. For a more cost-effective approach, we can look at establishing bear put spreads.

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UOB economists expected USD/JPY to edge higher in the near term after rebounding from oversold levels, but they saw gains capped below 159.60. They also flagged another resistance level at 159.35.

Support was at 158.90, and a break below 158.65 would have pointed to a return to range trading. Over a 1–3 week horizon, they still looked for another test of 157.50 as long as 159.60 held.

Market Context And Key Levels

The pair had previously fallen to 157.86 and then rebounded, with spot at 158.60 on 09 Apr. The article stated it was created with the help of an Artificial Intelligence tool and reviewed by an editor.

Looking back to April 10, 2025, USD/JPY was in a delicate position after rebounding from oversold conditions. The prevailing view was for the dollar to edge higher but to face strong resistance at 159.60, while the coming weeks still allowed for a potential re test of 157.50 as long as that resistance held.

Given this outlook, one derivative strategy would have been to sell call options with a strike price at or just above 159.60. This position, known as a covered call if holding USD or a naked call otherwise, would have allowed traders to collect premium by expressing the view that upside was limited and the pair would not breach that resistance within the option’s lifespan.

However, the wider economic context mattered. In the US, March 2025 inflation data released around then showed consumer prices remained stubbornly high, bolstering the case for the Federal Reserve to keep interest rates elevated, while the Bank of Japan had only just ended its negative interest rate policy the month before, a divergence that was supportive for USD/JPY.

Risk Management And Alternative Structures

That underlying strength ultimately overwhelmed the technical resistance levels being watched. In late April 2025, USD/JPY did not retreat, but instead pushed decisively through 159.60 and even broke 160.00 for the first time in over three decades, which would have produced significant losses for anyone who had sold naked calls.

This outcome underscored the major risk at the time: Japanese authority intervention, which occurred shortly after the breach of 160. The resulting volatility suggested a better fit could have been buying options, such as a straddle, to benefit from a large move in either direction, capturing both the upside burst and the sharp post intervention drop.

A more prudent approach for those still betting on limited upside would have been a bear call spread: sell a call at 159.60 and buy a call at a higher strike (for example, 160.00), which still collects premium while clearly defining and capping the maximum loss if USD/JPY surges beyond the resistance zone.

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The Pound Sterling rose against most major currencies on Friday, but not against other European currencies. It was near 1.3444 against the US Dollar during the European trading session.

The move followed reports of progress towards a Russia-Ukraine peace deal after a four-year war. Bloomberg reported that a senior adviser to Ukrainian President Volodymyr Zelenskyy said Ukraine is close to reaching a deal with Russia.

Sterling Outlook Against The Dollar

UOB said the short-term outlook for GBP/USD remains positive after gains above 1.3450. It said the pair could move towards 1.3520, but only if there is a daily close above 1.3480.

UOB placed support at 1.3330. It said intraday trading is expected within a 1.3390 to 1.3465 range.

UOB also referred to its earlier view from Wednesday, 08 April, when spot was 1.3400. It said it had expected room for the pair to rise to 1.3480, despite the rally appearing overdone.

Looking back to this time last year, in April 2025, we saw the Pound rally on hopes of a peace deal between Russia and Ukraine. The market was watching to see if GBP/USD could close above the key 1.3480 level to sustain its upward momentum. This optimism provided a temporary boost for Sterling against the dollar.

Option Strategy For June 2026

That rally ultimately fizzled out as we recall the pair failed to hold those gains, with the 1.3480 level acting as strong resistance throughout the rest of Q2 2025. The peace deal optimism was short-lived, and the market’s focus shifted back to economic fundamentals. This taught us that geopolitical news can create fleeting opportunities that are difficult to trade.

Today, the situation is driven by different factors. The Bank of England has adopted a more hawkish tone following the latest UK inflation report for March 2026, which showed consumer prices rising at an annual rate of 3.2%. With UK Q1 2026 GDP growth also surprising to the upside at 0.5%, the economic picture supports a stronger Pound.

Given this, we see opportunities in buying call options on GBP/USD with a strike price around 1.3600 for June 2026 expiry. This allows us to capture potential upside from expected interest rate hikes by the Bank of England. It is a defined-risk way to position for further Sterling strength over the coming weeks.

However, we must also consider that recent US jobs data has been robust, with the latest Non-Farm Payrolls figure for March 2026 exceeding 250,000 jobs. This keeps the US Federal Reserve in play for its own rate adjustments. To manage this risk, a bull call spread could be a prudent strategy, which would lower the initial cost of the trade.

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Salesforce, Inc (CRM) shares fell again yesterday and set a new multi-year low. The stock is down 55% since the beginning of 2025.

The fall has tracked wider declines in software stocks, linked to concerns that AI could reduce demand for software. The article describes this reaction as potentially short term.

It reports technical analysis signals, saying the price has filled a gap from March 2023. It also says the stock touched a previous pivot area from October and November 2022.

The article states an 80% probability of a bounce based on the author’s factors. It also projects a possible upside target of $210 in the coming weeks.

Looking back to 2025, we saw Salesforce get crushed by over 55% as fears mounted that AI would make its software obsolete. That analysis correctly identified a major technical floor, leading to a powerful squeeze off the multi-year lows. The stock did indeed hit the $210 target and continued to rally through the end of last year.

The narrative has now shifted from AI being a threat to it being a massive growth driver. In its last earnings report, Salesforce noted that customers using its Einstein AI tools saw an average 25% increase in sales team productivity. This fundamental shift has supported the stock’s recovery from those 2025 lows.

Given the stock is now consolidating, derivative traders could look at selling out-of-the-money puts for the May expiration, such as the $265 strike. This strategy collects premium by betting that the extreme fear we saw last year will not return in the near term. Recent options data shows implied volatility has settled near 32%, which is still profitable for premium sellers.

Alternatively, for those expecting a continuation of the uptrend into the next earnings cycle, buying a call spread is a defined-risk way to play. For example, buying the June $290 call and selling the June $310 call positions for a move higher. This takes advantage of the market’s renewed confidence in legacy software’s ability to adapt.

Invesco Ltd (IVZ) is described as a global investment firm managing ETFs, mutual funds and institutional assets across major asset classes. The text focuses on IVZ’s daily price chart rather than company fundamentals.

It describes a head and shoulders topping pattern that has been forming since last summer. The head reached about $29.50, then price fell, rebounded towards $25, and then turned down again.

The right shoulder is said to have stalled near $25, leaving overhead supply that has limited later rallies. IVZ is trading around $23.57, which is described as being at the neckline.

A key level is $21.86, described as the point that would confirm the pattern if IVZ records a daily close below it. The text distinguishes a daily close from an intraday move, which it says can create false signals.

If there is a confirmed close below $21.86, the measured-move target is stated as $14.99. The text also notes that $14.99 aligns with a prior support level.

It states that a confirmed close back above the neckline would be used as a stop level. It adds that a confirmed close above $25 would negate the bearish setup.

Looking back at the chart from 2025, we can see that head-and-shoulders top in Invesco was a textbook warning signal. The stock broke decisively below the $21.86 neckline later that year, confirming the pattern was live and triggering the setup. This breakdown coincided with broader market weakness as investors grew concerned about slowing global growth.

The move lower was not just a technical event; it was supported by fundamental pressures facing the entire asset management sector. We saw significant outflows from actively managed funds throughout the second half of 2025 as investors fled to cash. Invesco’s reported assets under management reflected this, showing a nearly 8% decline in the fourth quarter of 2025 compared to the prior year.

As anticipated, the stock price cascaded downward and hit the measured move target near $14.99 in early 2026. This level, a key support from years prior, attracted buyers and halted the decline, leading to the consolidation we are seeing today. Since that low, the stock has been trading in a range between roughly $15 and $17.50.

For derivative traders now, the primary opportunity has shifted from directional shorting to playing this new range. With the stock having already made its major move, implied volatility has decreased but still offers attractive premiums. Selling cash-secured puts at the $15 strike or selling covered calls against the $17.50 resistance are viable strategies to generate income from the current price action.

The old support level around $21.86 is now a distant but formidable resistance zone, and we are unlikely to test it soon. The critical level to watch now is the recent low near $15. Any confirmed close below that price would invalidate the current basing pattern and suggest another wave of selling is about to begin.

Hungary’s parliamentary election on Sunday is drawing attention after recent incidents and US Vice President Vance’s stated support for the incumbent, Viktor Orbán. The outcome is being watched for possible effects on EU unity and the euro.

A government led by Peter Magyar is expected by Brussels to reduce Hungary’s obstruction of EU decision-making. This includes decisions linked to support for Ukraine.

Election Stakes For The Euro

Orbán is blocking a €90 billion loan package for Ukraine. Reports say he is tying this to reported damage to the Druzhba pipeline, which previously carried Russian oil via Ukraine to Hungary and other parts of Europe.

An Orbán defeat is seen as a positive outcome for European cohesion and strategic autonomy, which could support the euro. However, a major change in policy is not assured.

The article states it was created with the help of an AI tool and reviewed by an editor.

The Hungarian election this coming Sunday is a significant event for Euro positioning. A loss for the incumbent, Orbán, is viewed as a potential positive catalyst for the currency, as it could unlock a stalled €90 billion aid package for Ukraine. We see this as a binary event that could reduce the political risk premium currently weighing on the euro.

Trading And Hedging Approaches

For traders anticipating a win by the challenger, Peter Magyar, buying short-dated call options on the EUR/USD is a direct way to position for a potential relief rally. Given that the euro has been trading at a discount to its interest rate differentials for most of early 2026, any sign of improved EU cohesion could cause a sharp upward move. This sentiment is reinforced by market reactions we saw in 2025 when initial concerns over Italian budget discipline eased, causing a 1.2% rally in the EUR/CHF over two days.

However, the possibility of an Orbán victory suggests hedging is prudent. An incumbent win would likely reinforce the current EU stalemate, capping any near-term upside for the euro and potentially causing a modest dip. Traders could consider put spreads to define risk or simply remain sidelined if they lack a strong conviction on the outcome.

The provided analysis rightly injects a note of caution, as a new government may not produce a dramatic policy shift. This uncertainty itself is a tradable event, suggesting that volatility may be underpriced. Buying a one-week EUR/USD straddle would profit from a significant price move in either direction following the election results.

Looking at historical parallels, we remember the sharp increase in volatility around the French elections in 2022 and the Brexit referendum in 2016. Currently, one-week implied volatility for the euro is hovering around 7.8%, which is elevated but still below the double-digit levels seen before those past events. We believe there is still value in buying volatility ahead of the weekend.

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The New Zealand Dollar (NZD) rose after hawkish comments from Reserve Bank of New Zealand (RBNZ) Governor Breman and lower oil-related risks. The Governor said the Bank would respond with rate hikes if core inflation accelerated.

Markets have turned more hawkish, with nearly three rate hikes priced in by year-end. This pricing is set against New Zealand’s sizeable negative output gap and weak growth in recent quarters.

Market Takes A More Hawkish Turn

The NZD is expected to lag the Australian Dollar (AUD). Softer oil prices may support further NZD gains against the USD, but the NZD is still expected to underperform the AUD.

The RBNZ is projected to start raising rates only in 4Q26. A single 25bp increase would take the policy rate to 2.75% by end-2026.

The article was produced using an Artificial Intelligence tool and reviewed by an editor.

The New Zealand dollar has seen a rally lately, mostly because of tough talk from the RBNZ Governor and some relief from lower oil prices. This has pushed the Kiwi higher against the US dollar. Markets have clearly listened to the hawkish warnings about inflation and are expecting forceful action.

Why The Market May Be Overpricing Hikes

However, we believe the market is pricing in too much tightening too quickly. The latest data from March 2026 showed GDP growth was almost flat at just 0.1%, and year-over-year inflation actually eased to 2.8%. This weak economic picture makes aggressive rate hikes unlikely.

Interest rate markets are now pricing in almost three full rate hikes by the end of this year. This seems excessive given the economy’s sizeable negative output gap. Looking back at 2025, we saw a similar pattern of weak growth that capped the central bank’s actions.

For derivative traders, this suggests the recent NZD strength is a selling opportunity. Buying NZD/USD put options with expiries in the next three to six months could be a way to position for a correction. The current market sentiment may have pushed the price of these options to attractive levels.

We also see the NZD underperforming the Australian dollar. Australia’s economy appears more resilient, with a steady unemployment rate holding near 4.0% and solid demand for its commodity exports. Therefore, a long AUD/NZD position using forward contracts seems like a logical pair trade.

Our own projections show the RBNZ will likely wait until the fourth quarter of 2026 to begin hiking. We only expect a single 25 basis point hike this year, bringing the policy rate to 2.75%. This is a sharp contrast to what is currently priced into the swaps market.

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ING economists expect the National Bank of Poland to keep interest rates unchanged after the April Monetary Policy Council meeting left the reference rate at 3.75%. The Council delivered a 25bp rate cut in March before holding rates in April.

The April statement was brief and neutral, and it linked global fuel price rises to supply constraints tied to the conflict in the Middle East. The Council is expected to take a wait-and-see approach based on incoming data and the effect of geopolitics and commodities on inflation and growth.

Inflation Drivers And Policy Signals

The NBP governor said near-term inflation will depend on energy commodity prices such as oil and natural gas, plus domestic tax and regulatory decisions, including excise duty and VAT on fuels. The Council is also expected to watch how higher fuel costs pass through to other prices.

Future policy is expected to depend on commodity prices, geopolitics, fiscal policy, fuel price rules, GDP changes and wage dynamics. ING’s baseline assumes the Lower Fuel Prices programme (CPN) lasts until the end of July, with average annual inflation at 3.2%, versus about 2% before the Persian Gulf war and 2.3% in the NBP’s March projection.

Under this scenario, rates could remain unchanged until at least end-2026, with a low probability of hikes.

Looking back at the analysis from 2025, the prediction for a prolonged hold by the National Bank of Poland has been accurate. The reference rate has indeed remained at 3.75% into the second quarter of 2026. This stability confirms the cautious, data-driven stance the Monetary Policy Council adopted following geopolitical shocks last year.

Market Implications For Rates And Volatility

The key challenge now is sticky inflation, which is proving more persistent than anticipated in 2025. While last year’s annual forecast was 3.2%, recent data from Poland’s statistics office for March 2026 shows headline inflation at 3.5% year-over-year. This is keeping the central bank firmly in its wait-and-see mode, as the pass-through effects from energy and wages continue to be a primary concern.

Strong domestic demand, fueled by a tight labor market with unemployment holding at a low 3.1%, is supporting wage growth and underlying price pressures. While Brent crude has stabilized around $88 per barrel, down from the peaks seen during the 2025 Persian Gulf conflict, the risk of energy price volatility remains. These factors combined make a compelling case for the NBP to continue its holding pattern through the summer.

For traders, this signals that the front end of the Polish zloty interest rate curve should remain anchored. We expect Forward Rate Agreements for the next two quarters to continue pricing in no change from the current 3.75% level. This environment suggests that income-generating strategies that benefit from low rate volatility are likely to be favored over directional bets on rate cuts or hikes.

However, options on Polish interest rate swaps may be underpricing the risk of a hawkish shift later in the year if inflation does not cool as expected. Given the NBP’s focus on wage dynamics and fiscal policy, any upside surprises in this data could quickly change the market narrative. Therefore, positioning for a potential, though currently unlikely, rise in interest rate volatility could be a prudent long-term hedge.

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GBP/JPY rose on Friday for a fifth day in a row, with the Japanese Yen weakening against most major currencies. Higher oil prices have weighed on the Yen because Japan is a large net importer.

The Pound has been supported by a mild rise in risk appetite after worries about the durability of the US-Iran ceasefire eased. Traders are also watching talks planned in Pakistan over the weekend.

GBP/JPY was trading near 214.12, the highest level since 9 February. The UK-Japan interest rate gap has continued to support the pair.

The trend remains upward, with small pullbacks inside a wider rise. The latest move followed a rebound from the 100-day simple moving average at 210.68.

Price is testing the 214.00-215.00 area that has limited gains since mid-January. A clear move above it would allow the uptrend to continue.

The RSI is near 63, suggesting rising momentum without overbought conditions. The MACD has turned positive again after a consolidation period.

If the pair falls, the first support level is the 100-day SMA at 210.68. Below that, the 200-day SMA at 205.52 is the next support area.

We see the GBP/JPY pushing higher, now testing the significant 214.00-215.00 resistance area as of April 10, 2026. This move is largely fueled by the huge difference between UK and Japanese interest rates, which makes holding the Pound more attractive. This interest rate gap, which we saw widen throughout 2025, remains a primary driver of our bullish outlook.

The Bank of England held its rate at 5.50% last month, while the Bank of Japan is only at 0.10%, creating a substantial yield advantage for traders holding Sterling. Adding to this, Brent crude oil prices are hovering around $95 a barrel, putting pressure on the Yen as Japan imports almost all of its oil. These factors create a strong fundamental reason for the pair to continue its upward trend.

Given this setup, we should consider buying call options with strike prices above 215.00, looking to profit from a sustained breakout in the coming weeks. The Relative Strength Index is still below overbought levels at 63, suggesting there is more room for the price to run. A clean break and close above 215.00 would be our trigger to add to long positions.

For those with a higher risk tolerance, selling out-of-the-money put options could be a way to collect premium, banking on the support holding firm. We would use the 100-day moving average, currently around 210.68, as a key level to watch. A break below this support would signal that the immediate upward momentum has faded and would require us to reassess our positions.

Hungary votes on Sunday, with results expected to shape European Union politics in coming years. Prime Minister Viktor Orbán faces a challenge from Péter Magyar and his Tisza party.

Polling puts Tisza on 48% and Orbán’s Fidesz on 39%. Orbán has faced criticism in Brussels over claims of weakening the rule of law and for slowing EU steps to sanction Russia after its invasion of Ukraine.

Orbán has also threatened to block the EU’s next seven-year budget for 2028-2035. This could affect the EU’s future funding plans.

Magyar, a former Orbán ally, is campaigning on rebuilding relations with the EU and NATO. He also says he would restore the rule of law and aims for Hungary to join the euro area by 2030.

Magyar has not set out a full break with Orbán’s foreign policy line. He is not calling for a fast reduction in ties with Russia and does not support sending military aid to Ukraine.

The Hungarian election this Sunday presents a significant volatility event for European markets. A potential victory by Péter Magyar is viewed as a pro-EU outcome, which could reduce political risk that has weighed on regional assets. We recall the market turbulence in mid-2025 when Orbán first threatened to veto the EU’s critical infrastructure security package, and traders are positioning for a reversal of that sentiment.

Attention is focused on the Hungarian forint, as a Magyar win could unlock billions in frozen EU funds, potentially strengthening the currency. Hungary is set to receive approximately €22 billion in cohesion funds from the current budget, and the release of this capital would be a major economic catalyst. We remember how the forint weakened by over 3% against the euro in the week following the contested 2022 election results, highlighting the currency’s sensitivity to political outcomes.

Implied volatility on one-month EUR/HUF options has already surged to 15%, a level not seen since the energy crisis of late 2025. This indicates that the market is pricing in a sharp move, making strategies that profit from volatility, like straddles, appealing ahead of the vote. An unexpected Orbán victory would likely trigger a sell-off in Hungarian assets, whereas a Magyar win might cause this volatility to collapse as uncertainty resolves.

Beyond currency, a pro-EU shift in Hungary could provide a modest lift for the euro and boost the Budapest Stock Exchange (BUX) index. However, since Magyar is not signalling a major policy break on Russia, any rally may be tempered. The key play remains centered on the forint and the unwinding of the political risk premium that has been priced into Hungarian assets for years.