Weekly Outlook : Markets Stay Cautiously Optimistic Despite Iran Ceasefire Violations and Oil Volatility

Markets remain cautiously optimistic after progress in U.S.-Iran negotiations helped push oil prices sharply lower and supported gains in global stock markets. However, fresh military exchanges between the U.S. and Iran have partially reversed some of that optimism, showing that geopolitical risks still remain elevated. Traders are now closely watching whether negotiations can continue and eventually lead to the reopening of the Strait of Hormuz, a key route for global oil supply.

This week, the main market focus will be on U.S. core PCE inflation data, the Federal Reserve’s preferred inflation measure. Strong inflation data could reduce expectations for rate cuts and even revive discussions about future rate hikes, supporting the U.S. dollar and Treasury yields.

Meanwhile, crude oil remains under pressure technically after breaking below a major triangle pattern, with markets still leaning toward expectations of improving oil supply flows if tensions continue to ease.

WTI Crude Daily Chart