On May 25, ATFX noted that news of a draft agreement between the United States and Iran had emerged as early as last Friday. However, as the news source denied the related content, market participants were unable to confirm the progress of the negotiations between the two parties.

Over the weekend, the news was confirmed: the United States and Iran have reached an agreement on key issues such as navigation in the Strait of Hormuz, forming a framework for the deal. According to media reports, the framework of the agreement between the United States and Iran is 95% complete, including a 60-day extension of the ceasefire and the reopening of the Strait of Hormuz during that period.

The chart above shows the minute-level movement of EUR/USD. Last Friday, the closing price was 1.1601. This Monday, the opening price was 1.1636, a gap-up opening of 35 basis points, forming a significant gap on the daily chart. This is a genuine reflection of the market's reaction to the news over the weekend that the U.S. and Iran have reached a framework agreement.

The underlying logic chain is as follows: once the Strait of Hormuz reopens, the international crude oil supply will rapidly recover, especially among OPEC member countries in the Middle East, who will quickly restore oil production capacity to pre-conflict levels from February 28. International oil prices are highly likely to fall in response, reducing the risk of high inflation in the United States and other developed nations. Central banks, including the Federal Reserve, will no longer need to implement tight monetary policies to combat potential inflationary pressures. Consequently, the U.S. dollar index is expected to show signs of depreciation following the establishment of the agreement framework.

The chart above shows the minute-level movement of WTI crude oil. The closing price last Friday was $95.91. This Monday, the opening price was $91.43, a gap-down opening of over $4 from the previous week, forming a clear downward gap on the daily chart. It is evident that market capital is highly confident in the expectation that the United States and Iran are on the verge of reaching an agreement.

It is important to note that, according to media reports, although the agreement between the United States and Iran is extremely close to being finalized, no formal agreement has been signed yet. If new developments arise in the future, such as either party refusing to sign the agreement, the current gaps in crude oil and the euro are highly likely to be filled.

Currently, crude oil trends are highly dependent on news developments, significantly diminishing the effectiveness of technical analysis. At this stage, it is recommended to closely monitor statements from former President Trump's social media and other public speeches to avoid external factors impacting the market and disrupting the rhythm of technical analysis.