S&P 500, USD/JPY and silver price rally
Technical analysis of the S&P 500, USD/JPY and silver price as they resume their ascents.
Macro update
Wall Street rebounds:
United States (US) equities finished higher after President Trump said a framework agreement on Greenland had been reached and that proposed tariffs on European allies would be shelved, reversing Tuesday’s sharp selloff.
Strongest gains in weeks:
The Dow Jones advanced 1.21%, the S&P 500 rose 1.16% and the Nasdaq 100 gained 1.18%, with the S&P posting its largest one-day increase in two months.
Banks drive the rally:
Solid earnings from major and regional lenders lifted the regional bank index 4.7% to its highest level since November 2024.
Energy and airlines outperform:
All S&P 500 sectors closed higher, led by energy stocks, while United Airlines climbed after delivering an upbeat first-quarter and full-year outlook.
Safe-haven demand eases:
The VIX volatility index retreated, US Treasuries found support and gold fell roughly $100 from its record high as geopolitical risk premiums faded.
Global spillover:
European equity futures jumped more than 1%, Asian markets advanced, the euro slipped back below $1.17, and markets continued to price around 45bp of US rate cuts this year.
S&P 500 rallies once again
The S&P 500's drop from last week's 6986 high has taken it to Tuesday's 6789 low amid US President Trump's tariff threat on several European countries with it once again rallying now that he back-tracked on imposing tariffs.
The late December high at 6903 represents the next upside target, followed by its mid-January 6986 record high.
If support at 6789 were to give way, though, the mid-December low at 6721 would be back on the map.
Short-term outlook:
Bullish while above the 20 January 6789 low.
Medium-term outlook:
Bullish while above the 6721 mid-December low.
S&P 500 daily candlestick chart
USD/JPY heads back towards the ¥160.00 region
USD/JPY has resumed its ascent from this week's ¥157.43 low with the mid-January peak at ¥159.45 and the ¥160 region being back in sight.
Upside momentum is expected to remain in play while the ¥157.43 low holds on a daily chart closing basis. Were it to give way, though, the 5 January low at ¥156.45 may be revisited.
Short-term outlook:
Bullish while above ¥157.43.
Medium-term outlook:
Bullish while above the 5 January low at ¥156.12.
USD/JPY daily candletsick chart
Silver price remains close to record high
The silver price has so far made a record high this week at $95.8823, an advance above which would put the psychological $100 region on the map.
Only a short-term bearish reversal to below the 15 January $86.4272 low may lead to the 29 December-to-7 January peaks at $84.0301 - $82.7707 being revisited. This support zone would be expected to then hold.
Short-term outlook:
Bullish while above the 15 January $86.4272 low.
Medium-term outlook:
Bullish while above the 31 December low at $70.0750.
Silver daily candlestick chart
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