The EUR/USD pair traded on Tuesday in the same manner as in recent weeks—exhibiting low volatility and a minimal upward tilt. In the current circumstances, it seems unnecessary to analyze which levels were breached and which were not, as 90% of the current movement is pure flat. Consequently, we can draw an important conclusion: the market is now ignoring not only macroeconomic factors but also geopolitics. Over the past two weeks, there has been a tremendous amount of news from the Middle East and the White House, but what impact have they had? Is the US dollar rising? No. Is the euro rising? No. The pair remains stagnant within a narrow range, and the market's response is confined to fluctuations within that range.

Essentially, there is currently nothing in the geopolitical arena for the market to react to. Washington and Tehran continue to bombard each other with threats, intermittently wanting to launch new strikes against their opponent, exit negotiations, or sign an agreement, and then strike again. The market has simply grown tired of such contradictory information. For example, on Monday, Iran's state media reported that Tehran has decided to suspend negotiations in response to new Israeli attacks in Lebanon. The market is prepared to buy dollars. Just a few hours later, it became known that Trump had spoken with Israeli Prime Minister Benjamin Netanyahu and dissuaded him from sending troops and launching missile strikes on Lebanon. What does this indicate? Washington does not want escalation, but does want to extract maximum benefit from the negotiations.

In essence, Trump once again applied the TACO principle—Trump Always Chickens Out. After two weeks of unending threats and numerous ceasefire violations, Trump determined that Iran's termination of negotiations was not quite what he needed personally. I say "personally" because the entire conflict in the Middle East is certainly not in America's interests. Trump is addressing his geopolitical ambitions rather than those of the US. As the resumption of conflict between Israel and Lebanon could genuinely lead to Iran's withdrawal from negotiations, Trump rightly concluded that intervention is necessary before it is too late.

Meanwhile, the Strait of Hormuz remains closed, and Iran promised to reinforce the blockade yesterday, as negotiations in the US have again reached an impasse, while simultaneously threatening to block the Bab-el-Mandeb Strait with the help of friendly Yemen. This has also implemented the NACHO principle—Not A Chance Hormuz Opens. As already mentioned, the market has reacted very little to all these events, aside from the intraday "convulsions." Traders rightly believe that, fundamentally, nothing has changed in recent weeks: Hormuz remains closed, negotiations intermittently commence and cease, transactions remain absent, peace is not achieved, but the ceasefire continues to hold. Without significant geopolitical changes or upheavals, expecting strong growth in the euro or the dollar is unlikely to be realistic.

The average volatility of the EUR/USD currency pair over the last five trading days as of June 3 is 52 pips and is characterized as "medium-low." We expect the pair to trade between 1.1587 and 1.1691 on Wednesday. The upper channel of linear regression has turned upwards, indicating a trend change to bullish. In fact, the upward trend from 2025 could have resumed as early as March. The CCI indicator has entered the overbought zone and formed two "bearish" divergences, signaling the start of a downward correction that is still not complete.

Nearest support levels:

• S1 – 1.1597
• S2 – 1.1536
• S3 – 1.1475

Nearest resistance levels:

• R1 – 1.1658
• R2 – 1.1719
• R3 – 1.1780

Trading Recommendations:

The EUR/USD pair continues its downward movement, which is presumably a correction within the broader upward trend. The global fundamental background for the dollar remains extremely negative, and only geopolitical factors regularly provide it with support. If the price remains below the moving average, short positions can be considered with targets at 1.1597 and 1.1587. Above the moving average line, long positions are viable with targets of 1.1691 and 1.1719. The market continues to distance itself from geopolitical factors, but in recent weeks, the dollar has been in demand as hopes for peace in the Middle East have weakened.

Explanations of Illustrations:

• Price levels (areas) of support and resistance (thick red lines) are levels where movement may conclude. They are not sources of trading signals.
• Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred from the 4-hour to the hourly timeframe. They are strong lines.
• Extreme levels (thin red lines) are points from which the price previously bounced. They are sources of trading signals.
• Yellow lines indicate trend lines, trend channels, and any other technical patterns.
• Indicator 1 on COT charts represents the size of the net position in each category of traders.