US Dollar marks an intermediate low as Israel-Iran tensions pursue

[Redator]

The role of the US Dollar is always evolving, with different factors going from demand for USD-denominated assets, settling commodity trades, cross-currency trades and many others affecting the Reserve currency.

A reminder that the Dollar had held impressive strength since the beginning of the 2022 hike cycle and 2025 Trump-Dollar nervosity has marked a longer-run top (for now).

April and peak tariff fears had formed what looked like a bottom but the rebound was found again with sharp rejection – since the dollar has returned to its downtrend but it seems that flows are shifting in the current geopolitical landscape.

The upcoming FOMC meeting (Wednesday June 18th) will add more clarity to what the Federal Reserve is looking for, and how the market interprets Powell's speech.

The Greenback is posting a strong rally as we speak and the narrative is forming with intermediate tops in EUR/USD, GBP/USD and other majors.

As a matter of fact, USD/JPY just broke the 145.00 psychological level and testing the top of its range – Breakout incoming?

Read More: What's a safe-haven? The USD makes a comeback amid Middle East tensions

Dollar Index (DXY) Intra-day update

DXY 30m Chart, June 17, 2025 – Source: TradingView

The USD has tested its 97.70 zone bottom a few times after missing in the past few inflation data and the last US Treasury Bond auctions have generated some demand.

Prices look to be going towards the 99.00 Pivot Zone after breaking the Weekly-open highs.

Last week's 30-Year and yesterday's 20-Year bond auctions haven't tailed (Tails = low demand), implying some turns of trends in Safe-Haven demands. We will get more news next week with shorter-duration Note issuances.

As a rule-of-thumb, good auctions lead to lower yields and gives less strength the the currency in question. However this year, bad auctions (Tails = low demand) led to more selling for the USD.

It will be essential to track upcoming moves in the US Dollar to get an idea of how strong the Reserve Currency is to respond to more uncertain geopolitical landscapes.

Euro, Pound and Yen Daily Charts

EUR/USD Daily Chart

EUR/USD Daily Chart, June 17, 2025 – Source: TradingView

GBP/USD Daily Chart

GBP/USD Daily Chart, June 17, 2025 – Source: TradingView

USD/JPY Daily Chart

USD/JPY Daily Chart, June 17, 2025 – Source: TradingView

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