US Dollar Supported by Middle East Risks Despite April Bearish Bias

The US dollar outlook for April was slightly bearish because of its usual seasonal weakness and improving global risk sentiment. However, the latest statement from the Iranian Parliament suggesting the Strait of Hormuz will not reopen and that negotiations are not taking place increases geopolitical uncertainty. This raises safe haven demand and can support the US dollar in the short term instead of allowing it to weaken.

From a technical perspective, the US Dollar Index is still trading below the key 100 resistance level, with stronger resistance near 101.50 to 102.00. On the downside, the 98.65 to 98.20 zone remains an important support area. As long as the index stays below resistance, the broader upside remains limited, but current geopolitical tension can slow any downside move.

DXY Daily Chart

Overall, April seasonality still favors a softer dollar, but Middle East developments and oil price risks are now the dominant drivers. If tensions remain elevated around Hormuz, the dollar could stay supported near current levels instead of moving lower quickly.