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FTSE 100 resumes ascent as silver price hits record high, USD/JPY stems sharp fall
Technical analysis of the FTSE 100 as it resumes ascent while the silver price hits a new record high and USD/JPY stems its sharp US-Japan intervention induced fall.
Macro update
Asian equities hit fresh records:
Asian markets pushed to new highs, with the MSCI Asia-Pacific ex-Japan index up around 1%, as optimism over United States (US) mega-cap earnings outweighed renewed tariff threats from President Trump.
South Korea shrugs off tariff risk:
Trump said US tariffs on South Korean imports would rise to 25%, but the KOSPI reversed early losses to climb more than 2% and set a new high, supported by hopes of diplomatic de-escalation.
Earnings optimism builds:
Nasdaq 100 futures rose about 0.5% as investors positioned ahead of results from Microsoft, Apple, Meta and Tesla, reinforcing expectations that strong tech earnings can prolong the equity rally.
Precious metals extend gains:
Gold advanced roughly 1% to just below its record near $5110 an ounce, while silver surged around 4%, as tariff uncertainty and a softer US dollar drove safe-haven demand.
FX and rates:
The US dollar remained under pressure near multi-month lows, while 10-year Treasury yields edged slightly higher to around 4.23% after several sessions of declines.
Oil eases:
Oil prices slipped, with Brent crude oil down about 0.7% to roughly $65 a barrel, as markets monitored the possibility of supply resuming from Kazakhstan.
FTSE 100 resumes its ascent
The FTSE 100 is trying to regain its mid-January 10,256 record high, a rise above which may put the 10,300 region on the cards.
On the way up lies the 22 January peak at 10,226 which would need to be exceeded for the above scenario to play out.
Support sits around Monday's 10,0096 low and between the 2 January high and the 20 January trough at 10,052 - 10,049.
Short-term outlook:
Bullish while above the 20 January low at 10,049.
Medium-term outlook:
Bullish while above the 8 January low at 9998.
FTSE 100 daily candlestick chart
USD/JPY found interim support
Following likely concerted intervention by the Bank of Japan (BoJ) and the US Federal Reserve (Fed) for the first time in 15 years, USD/JPY was pushed lower by around 2.5% to Monday's ¥153.31 low.
From there a minor recovery towards the early December low at ¥154.67 is currently taking place. The next higher ¥155.56 - ¥155.75 resistance zone is expected to cap any upside attempt this week.
Were Monday's low at ¥153.31 to give way, the 7 November low at ¥152.82 would probably be next in line.
Short-term outlook:
Neutral while above the 26 January low at ¥153.31.
Medium-term outlook:
Toppish now that the 5 December low at ¥154.35 has been slipped through.
USD/JPY daily candlestick chart
Silver trades in record highs
The silver price has so far risen to a record high at $117.7544, a rise above which would likely engage the $125 region.
Immediate upside pressure will remain in play while Monday's low at $102.5266 underpins. If not, the psychological $100 region may well be revisited.
Short-term outlook:
Bullish while above the 26 January low at $102.5266.
Medium-term outlook:
Bullish while above the 21 January low at $90.3355.
Silver daily candlestick chart
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