- US MarketsÂ
Stocks remained under pressure as sentiment soured after AI-related concerns triggered a selloff in US tech shares. The S&P 500 fell 1.5% on Thursday, erasing YTD gains for the index, which is now down 0.2%. The Nasdaq 100 Index has lost 2.2% YTD and fell 1.8% on Thursday.
The sharp moves over the past few days reflect the rising stakes tied to the AI boom and the unpredictable ripple effects across sectors, regions and asset classes. The moves also highlighted how quickly sentiment shifts around AI can reverberate far beyond the technology sector with the emergence of the AI scare trade.
The key event for traders on Friday will be the release of the US January inflation data. The median forecast is predicting a year-over-year increase of 2.5% for the core consumer price index, which strips out food and energy. The inflation print has gained added significance after Wednesday’s jobs numbers indicated strength in the US economy. Traders continued to assign little chance that Federal Reserve officials will lower rates when they meet next in March, with a July cut fully priced in.
From a technical perspective, the index dropped below the 9 and 21 SMA on the daily chart, adding a bearish bias. The RSI is around 32, indicating that selling pressure is building on the index. On the 4-hour chart, immediate support is at 5th Feb 2026 low of $6,762, followed by $6,719. Immediate resistance is $6,915-$6,920 (100 SMA and 61.8 fib resistance). Break above this level can push the index to test the all-time high level of $7,002.
- U.S. Dollar IndexÂ
The U.S. Dollar Index (DXY) closed flat on Thursday, while Friday’s Asian session is seeing some support with slight gains of around 0.15%. The EUR/USD pair trades 0.13% lower today, forming its fourth consecutive red candle on the daily chart.
Traders for the US dollar are adopting caution before the release of crucial inflation figures today, especially after a robust US nonfarm payrolls report highlighted a strong labour market and added some degree of support to the dollar’s recent decline. From a market standpoint, inflation data would likely have to come in above the 2.5% forecast to prompt investors to reassess the Fed’s policy outlook in a more hawkish direction. On the other hand, a reading that meets expectations or falls short would probably reinforce the current view that roughly two rate cuts remain on the table this year, thereby limiting further strength in the dollar.
From a technical standpoint, on the 4-hour chart, the dollar index is giving a breakout from a downward-sloping trendline connecting highs of 6th, 9th, 11th, and 12th February, suggesting short-term strength. Along with that, the RSI on the same timeframe has crossed above the 50 level and is sloping upwards, suggesting renewed buying momentum. The upside might get tested around the 21-EMA at the 97.46 levels as a potential resistance, while 11th Feb’s low around 96.49 may be a potential support for the short term.
- Crude Oil
Oil fell sharply by ~3% yesterday after the IEA revised its global demand outlook downward and forecasted a substantial surplus of more than 3.7 mbpd in 2026 despite the January outages. The agency also stated stockpiles had built up considerably last year at the strongest pace since the Covid-19 pandemic. Moreover, the broader markets have been gripped by risk-off sentiment as the ongoing nuclear talks between Washington and Tehran are likely to drag on without a quick resolution. Trump appears to be taking a more measured approach, allowing time for further discussions. This has tempered the possibility of short-run military action that could disrupt supplies. This appears to have capped oil’s upward trajectory so far this year, which was sparked by near-term geopolitical risks. Long-term fundamentals point to an excess supply, and Venezuela intends to grant Chevron and Respol additional oil production rights, which could further boost output. However, it is a long process that will require significant time and investment. The Trump administration is pushing private companies to revive the nation’s energy sector and is expected to grant additional licenses to allow oil companies to explore and produce in Venezuela without violating sanctions.
On the other hand, around 292 million barrels of sanctioned Russian and Iranian oil are currently floating in storage—over 50% higher than a year ago—as tougher sanctions, tanker seizures, and shifting buying patterns, particularly in India, force refiners to source alternative barrels from Western and Middle Eastern producers. This fragmentation has created a divergence between headline supply growth and real market availability, helping Brent crude rise in 2026 even as global inventories increase. However, prices remain highly sensitive to geopolitical developments, as any easing of sanctions or diplomatic breakthroughs could quickly release these stranded barrels back into the market.
Brent is down 0.12% at $67.52, with 38.2% Fib retracement support at $65.93, connecting the mid-December low to the late-January high. It could face resistance at $68.95. WTI is down 0.3% at $62.73, with immediate support around $61.55 and resistance around $65.
- Gold and SilverÂ
Gold and silver were on the defensive yesterday amid a broad market selloff. Gold is trading around $4,950, up 0.6% now, eyeing a reversal of the previous session’s 3.5% fall and looking to close above the key $5,000 level. Silver is around $77, up 2% after loosing 10.7% earlier, looking to finish the week above $80. Both metals are back on bids, trading in green.
The broad sell-off yesterday was triggered in part by markets pricing in a hawkish Fed ahead of today’s January CPI report, and the rest by tech-sector weakness. Weekly jobless claims fell slightly, and given the strong NFP print, traders sought to push back on the softer labour-market narrative and, with it, any imminent rate-cut expectations. However, markets still price in 2 rate cuts for the year, with the pushback mainly on the timing of those cuts, providing some footing for precious metals. Gold-backed ETFs saw modest net inflows on Thursday (up 10 tons for the week). A softer CPI print today would add to rate-cut expectations and subsequently to these metals’ upside. If inflation is reported as sticky, these metals might see further correction. Volatility will likely remain elevated today given the importance of CPI. Silver’s term structure of volatility is inverted, with front-end volatility pricing sharply elevated.
Gold is holding above the the $4,950-$4,960 support zone. The next support level is likely the 21-day EMA at $4,900. The RSI at 54 suggests a neutral but positive momentum. Any further upside needs a hold above the $5,000 level, where it might see resistance at the 50% retracement, with the next possible resistance near the $5,050 level.
Silver’s immediate support is likely around the $70-$72 zone. It sits below the key 50-day EMA at $79, which might act as resistance.
