Risk Sentiment Ignited on US-Iran Truce, Dollar & Oil Plunged on Risk Unwinds

Ultima Markets Daily Market Insights – 8 April 2026

Global markets are experiencing a significant sigh of relief this Wednesday. Following weeks of severe geopolitical escalation and intense volatility, reports of a temporary diplomatic breakthrough in the Middle East have triggered a massive unwinding of the geopolitical risk premium, driving a sharp rotation back into risk assets.

US-Iran Two-Week Ceasefire Eases Market Tension

The geopolitical landscape has shifted dramatically following the sudden agreement of a two-week ceasefire between the US and Iran. This temporary truce has immediately de-escalated the threat of a broader regional conflict, allowing equity bulls to confidently step back into the market.

Key updates driving the current market sentiment include:

• Temporary Truce Implemented: A 14-day ceasefire is now officially in effect, creating a crucial diplomatic window for formal negotiations regarding Tehran’s 10 core requests.
• Israeli Strikes Paused: Reports confirm that Israel’s planned retaliatory strikes on Iranian energy infrastructure have been officially suspended for the duration of the ceasefire.
• Ceasefire Negotiation: US-Iran negotiation will commence on this Friday, at Pakistan.
• Risk-On Sentiment Returns: Global equities are aggressively rallying as institutional capital flows back into the market, temporarily ignoring the underlying stagflation fears.

US Dollar Outlook: Safe-Haven Bids Unwind

The sudden de-escalation in the Middle East has pulled the fundamental rug out from under the US Dollar. Stripped of its massive geopolitical safe-haven appeal, the greenback is now facing intense, broad-based selling pressure.

After aggressively testing the massive 100.00 psychological resistance level, the US Dollar Index (USDX) has officially reversed course.

USDX, H4 Chart | Ultima Markets MT5

Traders are rapidly unwinding their long safe-haven positions, driving the index sharply lower. A sustained break below near-term support will confirm a deeper structural correction for the Dollar as the risk-on environment matures.

From a technical perspective, the 99.00 level, which was previously key support, now acts as major resistance, with 98.70 serving as minor support. In the near term, if the Dollar Index remains pressured below the 99.00 mark, it will likely set the course for a broader reversal. Conversely, regaining the 99.00 level would lead to prolonged consolidation, given the current macroeconomic outlook.

EUR/USD and AUD/USD Outlook: Capitalising on Dollar Weakness

The unwinding of the Dollar is providing a massive lifeline to battered major currency pairs. Risk-sensitive currencies are aggressively pushing higher as capital rotates back into higher-yielding assets.

For EUR/USD, the pair has successfully defended the critical 1.1500 support floor that we have been monitoring all week. Buoyed by the weakening Dollar and returning risk appetite, the Euro is staging a sharp recovery. Bulls will now be looking to establish a structural higher high to confirm a definitive near-term trend reversal.

EURUSD, H4 Chart | Ultima Markets MT5

From a technical perspective, EUR/USD has formed a potential double bottom alongside a reversal pattern. The breakout above the recent resistance neckline of 1.1630 suggests that a reversal is firmly in place.

For now, traders should watch for any potential retest towards this 1.1630 neckline, or the 1.1580 support zone. A successful retest would see bulls heavily dominate the near-term momentum.

Regarding AUD/USD, the pair is acting as a primary beneficiary of this renewed “risk-on” sentiment. The pair is aggressively reclaiming lost ground and bouncing firmly off the 0.6900 area. Traders will be watching for a sustained topside breakout to signal a clear end to its recent bearish correction.

AUDUSD, H4 Chart | Ultima Markets MT5

Besides bouncing off the 0.6900 support, we also see the pair aggressively moving back above the 0.7000 level. This signifies that the recent bearish turn for AUD/USD was not successful. We can now expect further upside movement, or at least continued consolidation within this higher range.

UKOIL Outlook: Gaps Down but Consolidates

The energy markets have reacted violently to the diplomatic breakthrough. With the immediate threat to Middle Eastern supply chains officially paused, the fear-driven surge in energy costs has instantly collapsed.

UKOUSD, H4 Chart | Ultima Markets MT5

UKOUSD (Brent Crude) gapped down significantly at the open as the market aggressively stripped out the immediate “war premium”. However, the commodity is currently entering a consolidation phase.

Traders are acutely aware that this is only a temporary two-week truce, not a permanent resolution. Oil prices will likely remain locked in a tight consolidation structure until the market can confidently price out the remaining risk premium, which depends entirely on whether this pause transitions into a comprehensive, long-term ceasefire agreement.

From a technical perspective, if the $100 psychological level holds as major resistance and there is a further break below the current range, it would signal that buyers are fading out. This could technically lead to a short-term bearish move within the two-week ceasefire window, unless a geopolitical surprise hits the wires.

What to Watch Today

• Geopolitical Headlines (All Day): The market will heavily scrutinise any comments from US or Iranian officials regarding the progress of the 14-day negotiations. Any signs of diplomatic friction will instantly reignite the safe-haven trade.
• Broad Risk Sentiment (All Day): Watch how the major indices and risk currencies perform as the European and US sessions open. Sustained buying pressure will confirm that institutional investors truly believe the worst of the geopolitical crisis is behind them.

Disclaimer

Comments, news, research, analysis, price, and all information contained in the article only serve as general information for readers and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.