Asian currencies traded mixed against the dollar Monday, with gains in some markets amid speculation that de-escalation of the Iran conflict could boost regional stability. The dollar remained flat at 157.58 yen but weakened slightly against the offshore yuan (6.8940) and Malaysian ringgit (3.9390), reflecting shifting risk appetite. StoneX analyst Matt Simpson noted traders are pricing in a potential conflict resolution “sooner than feared,” citing Trump’s remarks that tensions might end “very soon.” Technical indicators suggest the dollar may have formed a near-term top against the yen, with bearish signals emerging in USD/JPY charts.

The dollar’s recent rally stalled as geopolitical risks eased, with Simpson highlighting a “prominent shooting star candle” near resistance levels on daily charts. The pair closed below critical thresholds, including the monthly pivot and last week’s high, signaling potential bearish momentum. Meanwhile, the yuan’s 0.1% rise against the dollar and the ringgit’s 0.5% decline underscored divergent regional dynamics, with markets weighing U.S. policy shifts against local economic pressures.

Traders are monitoring central bank interventions, particularly in Japan, where the yen’s stability could hinge on Bank of Japan policy moves. The Mideast conflict remains a wildcard, with de-escalation hopes tempering volatility but leaving uncertainty over long-term geopolitical impacts. Simpson warned that any flare-up could reignite risk aversion, reversing recent gains.

Iran tensions continue to dominate market sentiment, with investors balancing optimism about short-term resolution against lingering risks. Analysts caution that while current trends suggest reduced escalation, the situation remains fluid. As the dollar navigates technical resistance levels, the interplay between geopolitical developments and monetary policy will likely dictate near-term currency flows.