US Markets
The S&P 500 Index dropped 1% on Friday to cap its biggest weekly loss since June. This was driven by a spike in crude prices, renewed inflation fears, and worries about the viability of the AI trade. Futures have slightly recovered today.
A wipeout in the shares of cloud-computing services provider CoreWeave Inc. accelerated the fall in tech stocks, sending the Nasdaq 100 Index down 2.5% on Friday for its worst week since April 2025. Concerns over funding for the AI buildout have hit tech infrastructure particularly hard, threatening the massive spending that has been driving sector sales and profits. The sharp decline in chip stocks — among the biggest beneficiaries of the AI boom — was one key sign of investor unease. The Philadelphia Stock Exchange Semiconductor Index, which includes chip giants like Nvidia Corp., Micron Technology Inc. and Advanced Micro Devices Inc., sank 3.8%, its eighth straight session of losses.
As traders debate whether valuations have reached unsustainable levels given the current economic and earnings environment, AI profit forecasts loom as a key test. Some of Nvidia Corp.’s biggest customers report soon, including Meta Platforms Inc. next Wednesday, followed by Microsoft Corp. on Oct. 28 and Amazon.com Inc. on Oct. 29. Tesla Inc., reporting on Wednesday, is expected to see a near-tripling in capital expenditures.
Fed officials are also entering a blackout period this weekend before their policy decision on Oct. 28, with rates expected to stay at the current levels for longer.
From a technical perspective, the SPX index has seemed to recover some of the losses and presents a moderately bullish bias for the day. Daily RSI seems to be picking up near 42 after being close to oversold territory on Friday. On the 1-hour chart, immediate support is at $7,686. A fall below this level can push prices to the 16th October low of $7,635. On the upside, the immediate target is at $7,739, followed by $7,764, which was the 16th October high.
US Dollar Index
The dollar index trades near 102.03, up toward the 102 level as euro weakness, driven by violent protests across France and other European countries, boosts the greenback. Escalating Russia-Ukraine hostilities and ongoing clashes between Saudi Arabia and Iran-backed Houthi rebels in Yemen, alongside continued tanker attacks in the Strait of Hormuz, are reinforcing the dollar’s safe-haven appeal. The Fed has entered its blackout period ahead of the October 27–28 meeting, with markets pricing roughly an 84–88% chance of rates staying unchanged, though a hike remains fully priced for December, followed by nearly two more next year. September inflation data came in hotter than expected, supporting the case for future tightening even if October itself sees a pause. US equity futures have bounced back from last week’s semiconductor-driven sell-off, adding a layer of support to the dollar alongside the broader risk backdrop. The US’s energy self-sufficiency means elevated oil prices from ongoing Middle East and Eastern Europe conflicts benefit the dollar directly, unlike oil-importing peers. While a fresh year-to-date high above 103.0 looks unlikely near term, the broader setup favours continued dollar support into the Fed meeting.
On the technical side, the index is testing resistance at 102.55, holding above its longer-term rising trendline support near 101.6–101.8. Support lies at 101.79, then 101.63, and a hold above this zone keeps the broader uptrend intact. A break above 102.55 would open the way toward the recent 18-month high near 102.95, then 103. A buy-on-dips approach toward support is favoured while the rising trendline holds, with the broader bias staying constructive given firm safe-haven and rate-differential support into the FOMC decision.
Crude Oil
Brent crude trades near $108.77, down 2.54% in early Monday trading after spiking to around $112 last week, its highest level since May.
Last week’s rally came despite a strong recovery in Gulf crude exports. Flows through the Strait of Hormuz are recovering, with US forces saying they helped escort 100 million barrels through the waterway last week. Year-to-date shipments are, however, still below 2025’s pace, despite higher South American exports and stockpile releases. That suggests prices could stay elevated until the conflicts in the Arabian Gulf and Ukraine are resolved.
Meanwhile, President Trump has agreed to hold off on tightening sanctions on Moscow in exchange for Russian diesel supplies to the global market, with a US license permitting the flows until April. Russian Deputy Prime Minister Alexander Novak said deliveries to the US could start 15–20 days after contracts are signed. He added that volumes could rise from 300,000 tonnes in October to 3–3.5 million tonnes a month by year-end, provided Russian refineries operate normally.
On the de-escalation side, the Kremlin confirmed talks over a possible Putin-Trump-Xi summit on Ukraine, potentially at next month’s APEC meeting in Shenzhen. High fuel prices are weighing on the US economy ahead of the November 3 midterms, so Washington’s push to lower energy costs remains a downside risk.
Brent briefly broke its long-term downward trendline last week, surging to about $112, but has since returned below it, now trading near $108.77 and raising the risk of a false breakout. Resistance lies at $110.20, then $111.63. Support is at $107.50 near the 50-period EMA, then $106.10.
WTI is trading at around 98.50, off more than 2.30% after a violent rejection at 101.25. Resistance is at 100.98 near previous session highs. Support is at $97.30, then $95.94.
Gold & Silver
Precious metals were relatively flat on Friday, with gold down 0.13% and silver down 0.77%. Gold’s weekly return remained more stable, with a 0.70% fall, while Silver faced pressure, dropping 6.33%. The Asian session on Monday saw strength return to the metals, with gold up 0.45% and silver up 1.25%.
Gold rose back above $4,180 on Monday as the dovish tone of Fed Chair Kevin Warsh at the IMF annual meetings in Bangkok on Friday led traders to pull back on their expectations of rate hikes. Warsh didn’t say a word about the outcome of the FOMC meeting this month and as a result, the probability of a hike in October has now dropped to 12.7% from 21% a week ago. That’s negative for US Treasuries across the curve and has contributed to recent weakness in the US dollar and support for non-yielding bullion. Oil prices have also retreated from their monthly highs as President Trump has waived sanctions and tariffs on Russian energy to keep Moscow at the table in the Ukraine talks. That has eased inflation fears and expectations of Fed tightening. Gold also picked up safe-haven demand as concerns over AI investments drove a selloff in equities and a fall in bond yields.
Technically, Gold prices are rebounding from a trendline connecting the lows of 30th June, 17th July, 7th October, and 14th October on the daily chart. Additionally, prices have recovered above the 9-EMA on the same timeframe, suggesting a market structure tilted towards the upside in the short term. Silver also seems to be rebounding from a horizontal support from the lows of 24th June, 17th July, and 14th October, suggesting a similar structure to gold.
