​​​Macro update

​• Wall Street pulls back as AI concerns grow:

​United States (US) equities ended mixed, with the S&P 500 falling 0.51% and the Nasdaq 100 sliding 1.51% as investors reassessed elevated artificial intelligence (AI) valuations, while the Dow Jones rose 0.53% on rotation into value and defensive stocks.

​• Semiconductors drive the sell-off:

​Advanced Micro Devices (AMD) plunged 17% after issuing a weak revenue outlook, dragging NVIDIA down 3.4% and pushing the Philadelphia Semiconductor Index 4.4% lower, fuelling fears that gains among AI leaders are becoming more concentrated.

​• Software stocks come under pressure:

​Palantir dropped nearly 12%, giving back earlier gains, while Snowflake and Datadog extended losses as concerns grew that rapidly evolving AI tools could disrupt established software business models.

​• Earnings positives cushion the downside:

Eli Lilly surged around 10% after projecting 2026 profits above expectations, while Super Micro Computer jumped nearly 14% after raising its revenue outlook on strong AI server demand.

​• Asia tracks Wall Street lower:

​Asian markets extended the global tech sell-off, with South Korea’s KOSPI down almost 4% and Japan’s Nikkei 225 lower by 0.7%, as Alphabet’s sharply higher capex plans heightened worries over the rising cost of AI investment.

​• Commodities and crypto retreat:

Silver slumped about 13% amid forced selling, oil fell roughly 2% on easing geopolitical risks, and Bitcoin dropped 3.4% to its lowest level since November 2024, highlighting a broader pullback from risk assets.

​S&P 500 looks to be short-term under pressure

​The S&P 500's failed retest of its 7002 record high earlier this week has led to a slip to Wednesday's 6839 low. Were it to give way, the 20 January low at 6789 may be reached next. Failure at this level would probably lead to a significant bearish reversal taking hold.

​While the 6789 level holds, though, a recovery towards the 7000 region may still ensue.

​Short-term outlook:

Neutral with a bearish bias while above the 20 January 6789 low, failure there would make us bearish.

​Medium-term outlook:

Bullish while above the 6721 mid-December low.

S&P 500 daily candlestick chart

​USD/JPY advance continues

​USD/JPY has so far managed to regain most of its recent near 4% drop and is seen heading towards its ¥157.76 December peak. A rise above this high would likely engage the January high at ¥159.45.

​Minor support may be spotted between the 55-day simple moving average (SMA) and the early January low at ¥156.29 - ¥156.12.

​Short-term outlook:

Bullish while above ¥155.56, the 24 December low.

​Medium-term outlook:

Bullish while above ¥152.10 but may once again be capped by the ¥159.00-to-¥160.00 region.

USD/JPY daily candletsick chart

Silver price comes off again

​The silver price's recovery from Monday's $71.3157 low to Wednesday's $92.2049 high has been followed by another sharp sell-off to Thursday's $73.5043 intraday low. This puts the bears back in control.

​A fall through this week's low at $71.3157 and the next lower late December low at $70.0750 would probably lead to another down leg towards the mid-December low at $66.8973 being formed.

​Short-term outlook:

Bearish while below the 4 February $92.2049 high.

​Medium-term outlook:

Neutral while above the 2 February low at $71.3157.

Silver daily candletsick chart