- US Markets
After touching record highs last week, the S&P 500 index closed 0.33% lower, with Friday relatively flat. Monday’s Asian session is seeing further weakness with the SPX trading 0.85% lower and the NDX trading 1.07% lower. The markets will be closed in the US today in observance of Martin Luther King Jr. Day, resulting in relatively muted trading volumes.
The decline is being fueled by rising tensions over President Trump’s renewed tariffs on numerous European nations until the US can purchase Greenland. The EU is weighing a halt to last year’s trade agreement, leading to broader uncertainty among countries worldwide about the validity of existing trade agreements with the US. Aside from this, Investors have a lot to look forward to this week from a macro perspective, with the release of crucial GDP growth and inflation metrics scheduled for Thursday, along with a speech from President Trump on Wednesday expected to spark volatility. Moreover, the earnings season has started in full swing, with major companies like Netflix, Visa and Intel scheduled to report earnings this week.
From a technical perspective, the SPX index opened with a significant gap down on Monday, taking prices below the 9- and 21-SMA levels on the daily chart, suggesting bearish pressure in the short term. This also marked the break of an upward sloping trendline connecting the lows of 21st November, 18th December, 2nd January, and 14th January, reinforcing the view. However, prices are currently trading at the 200-SMA on the 4-hour chart, with the 50-SMA support on the daily chart around the $6,842 level, which caps significant downside. A recovery could be expected if prices can hold above the key $6,893 level, from the low of 14th January.
- US Dollar Index
The US Dollar Index is down about 0.35 today and is currently trading at 99.
From a fundamental standpoint, Trump Tariff Threats are back in the picture, causing the DXY to weaken in the day. Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands, and Finland will be subject to a 10% tariff starting February 1 over the Greenland issue, and the tariffs would remain in effect until an agreement is reached on the United States’ purchase of Greenland. Furthermore, Trump threatened to impose tariffs of up to 25% on Greenland starting June 1. In response, the EU is preparing tariffs worth €93 billion in response to Trump’s threats over Greenland. Looking at the economic calendar, it is a relatively light day, as US markets are closed for Martin Luther King, Jr. Day.
From a technical standpoint, the index is testing the 8-Day EMA, and a bullish crossover between the 21- and 50-Day EMAs is evident. The nearest support is at 98.75. The 98.75 mark serves as a breakout retest level and coincides with the 50-EMA, making it an attractive entry point.
Looking at EURUSD, the currency pair has bounced after testing the 70.5% fib level drawn from the low of 1.147 to the high of 1.181. Currently, the currency pair is testing the 8-EMA resistance at 1.164, and a bearish crossover between the 21- and 50-EMAs is evident, supporting a bearish stance. A break of the 1.164 level ensues bullish bets on the currency.
- Crude Oil
WTI edged up 0.14% on Friday and rose a further 0.59% in early Monday trading. However, oil prices are likely to remain muted today as US markets are closed and trading volumes stay thin, despite ongoing geopolitical tensions in the Middle East.
Last week, oil prices gained 1.15%, briefly touching $63 before retreating to $59 amid rising unrest in Iran. That said, the Iran risk premium has since faded after President Trump stepped back from potential intervention, easing fears of near-term supply disruption as his focus shifted to Greenland. With Middle East tensions cooling for now, investor attention has returned to concerns about global oversupply. A higher-than-expected increase in U.S. crude inventory also added to the softness.
From a technical perspective, on the hourly chart, WTI is consolidating within a range of $59.53 to $60.47. The $59.53 level has acted as strong support since January 15, and a break below this could open downside towards $58.11. On the daily chart, WTI is hovering near its 9-day SMA. A sustained move above the 9-day SMA at $59.28 could see prices test resistance at $59.76, the recent intraday high.
- Gold & Silver
Gold closed near $4,595 on Friday, and is up 1.6% in today’s Asian session, trading near $4,670. The bullion surged to fresh record highs as geopolitical risk escalated sharply after President Trump announced tariffs on several European nations in response to opposition to the U.S. plan to acquire Greenland. The move reignited fears of a transatlantic trade war, undermining confidence in the US dollar and driving investors toward safe-haven assets.
The new tariffs, which will begin at 10% in February and rise to 25% by June, have prompted emergency talks around Europe. The price of gold has also been rising amid heightened fears of geopolitical turmoil following the latest U.S. action in Venezuela and past threats against Iran. The price of gold has seen steady safe-haven investment demand amid persistent political risk, trade turmoil, and currency scepticism. If trade talks break down and market volatility persists, gold is likely to remain near its all-time highs, as any price drop will likely be seen as a buying opportunity.
Technically, gold is trading above all key SMAs and retains a bullish bias, with potential resistance around $4,700. Support may be seen at the 9-SMA level of $4,570. Silver also touched a fresh high of $94.12 today and is currently trading near $93.31 (+3.6%). Resistance lies at the psychological level of $95 and support may be seen around $90.
