S&P 500, silver price slip as EUR/GBP stabilises
Technical analysis of the S&P 500 and the price of silver as they slip while EUR/GBP stabilises.
Macro update
Equities under pressure:
Asian markets declined in volatile trading, with the Nikkei 225 down 0.7%, South Korea falling 2.7% and the Hang Seng losing 1.7%, while futures point to softer US and European openings.
Oil rebounds above $100:
Brent crude oil climbed around 2% to above $104 a barrel, pushing monthly gains beyond 40% as disruption to Strait of Hormuz flows and fading ceasefire hopes supported prices.
Ceasefire uncertainty dominates:
Iran is reviewing a US proposal but denies formal negotiations, leaving markets highly sensitive to mixed headlines and doubtful about a near-term resolution.
Inflation and rates repriced:
Rising energy costs have revived inflation concerns, with markets removing expectations for Federal Reserve (Fed) rate cuts this year and central banks, including the European Central Bank (ECB), signalling a more hawkish stance.
Bond and FX moves reflect policy shift:
Japan’s two-year yield hit a 30-year high on rate hike expectations, while the US dollar remains firm near recent highs despite a slight pullback, supported by safe-haven demand.
Supply shocks deepen oil risks:
In addition to Middle East disruption, around 40% of Russia’s export capacity is reportedly offline and Iraqi production is constrained, reinforcing expectations of structurally higher energy prices.
S&P 500 remains under pressure
The S&P 500 continues its descent with the 24 March low at 6525 representing a possible downside target. Below it lies key support at this week's 6474 low, a fall through which could trigger a significant sell-off.
Downside pressure is likely to remain in play while the 6624 - 6651 resistance zone caps.
Short-term outlook:
Bearish while below Monday's 6651 high; if overcome, we would turn bullish, though.
Medium-term outlook:
Neutral while above the 6474 current March low but below the 7002 January peak; a drop through 6474 would make us bearish and target the 6400 region and lower.
S&P 500 daily candlestick chart
EUR/GBP range trades
EUR/GBP's recovery from the £0.8613 - £0.8610 early February and late August 2025 lows last week took it to £0.8679 before giving back half of its gains this week and range trade.
While the £0.8613 - £0.8610 support zone continues to hold, further sideways trading remains on the cards.
Above this week's £0.8679 high meanders the 200-day simple moving average (SMA) at £0.8692.
Short-term outlook:
Neutral with a bearish undertone while below £0.8679 but above the £0.8613 - £0.8610 support zone; failure there would likely engage the early July-to-August 2025 lows at £0.8597.
EUR/GBP daily candlestick chart
Silver price slips
The price of silver has resumed its descent and is seen slipping towards its 19 March low at $65.4892 and its early February trough at $64.0626.
Downside pressure is expected to be dominant while the price of silver remains below its 25 March $74.5720 high. Above it the January to March downtrend line may be seen at $77.2350.
Short-term outlook:
Bearish while below the 25 March $74.5720 high.
Medium-term outlook:
Neutral while above the 23 March low at $61.0065 but below the 2 March high at $96.4255; failure at $61.0065 would turn our forecast bearish.
Silver daily candlestick chart
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