Copper jumped to its highest level in three weeks on Wednesday after American President Donald Trump agreed to a two-week ceasefire with Iran, which eased fears of a global economic slowdown resulting from the conflict in the Middle East.

Benchmark three-month copper on the London Metal Exchange climbed by 3.5% to reach $12,737.50 per ton by 09:20 GMT, after touching its highest level since March 18 at $12,755.50. Copper had declined by 7.6% in March due to economic concerns arising from the Iranian war.

Trump indicated that the ceasefire is conditional on Iran's agreement to suspend the blockade of oil and gas passing through the Strait of Hormuz. Crude oil prices fell by more than 16% on Wednesday.

The brokerage firm Sucden Financial said in a note on base metals:

"While this (the ceasefire) may lead to short-term relief in the energy risk premium, the agreement appears fragile and conditional, suggesting that markets are likely to remain news-driven rather than shifting to a sustainable environment of positive risk."

The discount of the spot copper contract on the London Metal Exchange against the three-month contract widened to $89.50 per ton from $84.60 on Tuesday, which suggests the absence of a shortage in available metal.

Copper inventories in warehouses approved by the London Metal Exchange rose on April 7 to 385,275 tons, an increase of 10,075 tons from April 2, which is the highest level since March 2018. The volume increased thanks to inflows to New Orleans and locations in Asia.

As for aluminum prices, which rose when the metal was unable to follow its natural path from Gulf producers to export markets through the Strait of Hormuz, they stabilized at $3,475 per ton.

Smelters in the United Arab Emirates and Bahrain were subjected to attack and sabotage by Iran late last month, which led to taking supplies out of the market. At the same time, the Iranian Mehr News Agency stated that reports of an American-Israeli attack on the aluminum plant in Arak in central Iran are incorrect.

In a broad wave of relief for base metals, nickel jumped by 2.6% to $17,385 per ton, and tin climbed by 4.8% to $48,030, and lead added 0.6% to reach $1,957.50, while zinc rose 0.5% to $3,322.50.

Bitcoin and other cryptocurrencies rose strongly on Wednesday, amid relief in the markets after the United States and Iran reached an agreement for a ceasefire for 14 days pending negotiations aimed at reaching a permanent peace agreement.

Bitcoin climbed by 5% to reach about $71,842 early on Wednesday, recording its highest level since mid-March.

As for the rest of the cryptocurrencies, Ethereum rose by 7.7%, and Ripple also climbed by 5.5%, while Solana rose by 6.5%. As for Dogecoin, which is a memecoin, it rose by 4.4%.

During recent months, cryptocurrencies have generally traded as high-risk and high-volatility assets, and they declined with the escalation of fighting in the Middle East. Bitcoin also remains down sharply compared to its record level that exceeded $126 thousand in October of last year.

Stocks of companies linked to cryptocurrencies also recorded a rise, as the stock of MicroStrategy, the largest corporate holder of Bitcoin, climbed by 6.7%, while the stock of the cryptocurrency trading platform Coinbase Global rose by 4.9%.

And after daily gains amounting to 4.79%, Bitcoin regained the key moving averages, but it faces an important cluster of resistance levels near the session highs.

This rise pushed the price clearly above both the 20-day Exponential Moving Average at $68,749 and the 50-day Simple Moving Average at $68,683, however, resistance pressures began to appear with the approach of the price to the first technical barrier at $71,979.

This situation represents a classic scenario of price reversion to the mean, where the rapid recovery of Bitcoin faces the challenge of maintaining momentum above the moving averages that were recently regained. Also, the proximity of the price to several overlapping resistance levels indicates that the next few sessions will determine whether this bullish recovery can continue or will need a phase of consolidation.

The recovery wave faces a cluster of resistance near the session highs

The trading range during the day, between $67,805 and $72,379, reflects the return of buying interest after Bitcoin succeeded in defending support levels earlier in the session. The current price at $71,780 is slightly below the first resistance level at $71,979, which creates a narrow zone in which directional momentum faces the next decisive test.

Also, the trading volume during 24 hours amounting to $54.39 billion provides sufficient liquidity to support the rise. However, the approach of the price to the high level of the session coincides with several technical barriers that may limit the continuation of the rise in the near term.

The support structure is still holding above $64,972 despite the risks of correction

The technical support structure remains strong, as the first level at $64,972 provides an important barrier. This gap amounting to $6,808 grants protection space on the downside in case the recovery faces selling pressures near the resistance zones. As for the second support, it is located at $62,553, which is a more solid technical floor level. These levels form the wider trading range, although the focus currently is on testing resistance given the current position of Bitcoin.

Conclusion: Regaining moving averages paves the way for the next move

The trading of Bitcoin above the 20-day Exponential Moving Average and the 50-day Simple Moving Average represents an important technical development. The bullish scenario consists of the continuation of trading above these averages, which may lead to testing the level of $74,659 and the Fibonacci confluence zone. As for the bearish scenario, it consists of pressures of reversion to the mean, which may push the price to drop below $68,749, with targeting the support level at $64,972.

Oil prices fell below $100 per barrel on Wednesday after Donald Trump announced his approval of a two-week ceasefire with Iran, on the condition of an immediate and safe reopening of the Strait of Hormuz.

Brent crude futures contracts fell by $17.47, or 16%, to $91.80 per barrel by 12:05 GMT. West Texas Intermediate (WTI) crude contracts also declined by $20.33, or 18%, to $92.62 per barrel.

Benchmark European diesel prices also dropped sharply, losing $317.25, or 20.8%, to reach $1,210.50 per metric ton.

Trump's shift in position came shortly before the deadline he had set for Iran to reopen the Strait of Hormuz or face extensive attacks on its civilian infrastructure. Approximately 20% of the world's daily oil supplies pass through this narrow maritime corridor.

Trump wrote on social media: "This will be a ceasefire from both sides!", after he had earlier posted on Tuesday that "an entire civilization will die tonight" if his demands were not met.

Iran stated that it would stop its attacks if strikes against it ceased, and that safe passage through the Strait of Hormuz would be possible for two weeks in coordination with the Iranian armed forces, according to a statement by Foreign Minister Abbas Araghchi.

A senior Iranian official involved in the talks told Reuters that Iran may reopen the strait in a limited and organized manner on Thursday or Friday before a meeting between American and Iranian officials in Pakistan.

Tamas Varga, an analyst at brokerage PVM Oil Associates, said that about 10 to 13 million barrels per day of oil and product supplies stuck behind the Strait of Hormuz are expected to begin flowing gradually now.

He added: "Whether the situation that existed before March will fully return depends entirely on whether the truce can be converted into a permanent peace during the negotiations in Pakistan."

Ship operators are still seeking clarity on logistical aspects, while refineries began inquiring about new crude shipments on Wednesday in response to the ceasefire agreement.

Several Gulf countries also detected missile launches and drone attacks, or issued warnings to civilians of the necessity to take cover.

Saul Kavonic, an analyst at MST Marquee, said: "Even with reaching a peace agreement, Iran may become more emboldened in threatening the Strait of Hormuz in the future, and the market will price in a higher level of risks associated with the strait."

The American-Israeli war with Iran led to the largest monthly rise in oil prices in history, as the increase exceeded 50%.

Vivek Dhar, an analyst at Commonwealth Bank of Australia, said there is "room for a significant geopolitical premium to continue in prices in the foreseeable future depending on the details of the comprehensive agreement."

Trump indicated that the United States received a 10-point proposal from Iran, which he described as a practical basis for negotiation, adding that the parties have come very close to reaching a final agreement to achieve long-term peace.

He added on Wednesday that the United States will work closely with Iran, and will discuss with Tehran the issue of easing customs duties and sanctions.

The dollar fell to its lowest level in one month, while the euro, the yen, and the Australian and New Zealand dollars rose strongly during Asian trading on Wednesday, after Donald Trump announced his approval of a two-week ceasefire with Iran.

The Japanese yen rose by 0.7% against the dollar to reach 158.50 yen per dollar. The euro also climbed by 0.7% to $1.1677, while the British pound rose by 0.8% to $1.3403.

The Australian dollar jumped by 1.2% to $0.7063, while the New Zealand dollar rose by 1.1% to $0.5795.

Trump had previously threatened to launch extensive attacks on civilian infrastructure in Iran, which sparked international condemnations after he issued an unusual warning in which he said that "an entire civilization will die tonight" if his demands were not met.

But investors' appetite for risk returned quickly after the announcement of the ceasefire, less than two hours before the expiration of the deadline set by Trump for Tehran to reopen the Strait of Hormuz.

Ray Attrill, head of currency strategy at National Australia Bank in Sydney, said that in the event of reopening the strait "we may witness the continuation of the upward wave driven by the increased appetite for risks that we are seeing currently."

He added: "But much must happen during the next fourteen days," pointing out that currencies may be vulnerable to a correction in their recent movements during this period, and that "markets still need a measure of skepticism and caution."

The U.S. Dollar Index, which measures the strength of the dollar against a basket of six major currencies, declined for the third consecutive day to 98.943, which is its lowest level since March 11.