USD Mixed, Oil Surges as Iran Conflict Drives Risk-Off Sentiment

US equity markets ended the week with mixed results as the unresolved Iranian conflict continued to weigh on investor sentiment, while rising oil prices added complexity to the forex landscape. Crude oil's sustained rally has significant implications for commodity-linked currencies, potentially supporting CAD and NOK while pressuring oil-importing nations' currencies such as JPY and INR. The persistent geopolitical uncertainty is reinforcing risk-off positioning across major forex pairs, with safe-haven currencies including the US dollar, Swiss franc, and Japanese yen seeing intermittent demand. The lack of diplomatic progress, underscored by the cancellation of US-Pakistan talks, suggests the conflict premium in markets may persist into the coming weeks. For USD traders, the interplay between safe-haven demand supporting the dollar and rising oil-driven inflation expectations complicating the Federal Reserve's rate path creates a nuanced outlook. Key levels to watch include EUR/USD holding within recent consolidation ranges and USD/CAD potentially testing lower support as oil prices benefit the loonie. Traders should remain cautious given elevated weekend headline risk.