S&P 500, silver price trade in record highs as USD/JPY stabilises
Technical analysis of the S&P 500, silver as both trade in record highs while USD/JPY stabilises.
Macro update
US equities muted after Fed:
The Nasdaq 100 edged up 0.17%, while the S&P 500 and Dow Jones finished flat as markets digested a largely unsurprising Federal Reserve (Fed) decision to leave rates unchanged.
Fed message steady, June remains pivotal:
The Fed chair said inflation is still elevated but labour-market risks have eased, reinforcing expectations that the first rate cut is more likely in June rather than April.
Tech and chips power gains:
NVIDIA rose 1.6%, Micron jumped 6% and Intel surged 11%, supported by strong results from SK Hynix and record orders at ASML, boosting global semiconductor sentiment.
Earnings trigger sharp stock moves:
Texas Instruments climbed nearly 10% and Seagate surged more than 19% on upbeat outlooks, while Textron slid almost 8% after issuing weaker guidance.
Magnificent Seven reactions mixed:
In after-hours trade, Meta rose about 4% and Tesla gained 3%, while Microsoft fell more than 3% as investors questioned the returns on heavy artificial intelligence (AI)-related capital spending.
Asia and commodities firm overnight:
Asian tech stocks extended January’s rally, gold climbed another 2.7% to fresh highs, oil reached four-month peaks, and the United States (US) dollar remained under pressure despite official support.
S&P 500 trades in record highs
The S&P 500's rally to a record high at 7002 has been followed by a slight sell-off to 6964 on Wednesday. While remaining above this level on a daily chart closing basis, a 261.8% Fibonacci extension at 7018 should remain in sight.
Were Wednesday's low at 6964 to be slipped through, though, the 7 January high at 6965 and possibly the late December peak at 6945 may be revisited.
Short-term outlook:
Bullish while above the 20 January 6,789 low.
Medium-term outlook:
Bullish while above the 6,721 mid-December low.
S&P 500 daily candlestick chart
USD/JPY hovers above ¥152 region
USD/JPY's near 4% drop following probable concerted intervention by the Bank of Japan (BoJ) and US Fed earlier this week has been followed by a slight recovery from this week's ¥152.10 low.
The ¥154.05 - ¥154.95 resistance area is thus in sight but may well cap.
Were this week's low at ¥152.10 to be fallen through, the late October low at ¥151.54 would be next in line.
Short-term outlook:
Bearish while below ¥154.95.
Medium-term outlook:
Toppish while below ¥159.45.
USD/JPY daily candlestick chart
Silver price continues to trade in record highs
The silver price has so far made yet another all-time high, this time at $120.47, whilst gunning for the $125 region.
Only a bearish reversal to below the 26 January $102.5166 low may lead to a short-term trend reversal. While above this level, further upside remains the more likely scenario.
Short-term outlook:
Bullish while above the 26 January $102.5166 low.
Medium-term outlook:
Bullish while above the 21 January low at $90.3355.
Silver daily candlestick chart
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