- US100 holds losses after AI-scare trade selloff.
- Gold softens but remains near three‑week high amid tariff chaos, geopolitics.
- USDJPY eyes triangle breakout as Takaichi’s rate‑hike stance pressures yen ahead of inflation data.
AI woes hit Wall Street – US100
US stock futures steadied on Tuesday after a wobbly start to the week, as a fresh bout of AI‑disruption‑driven selling rattled investors. Sentiment was further pressured by renewed uncertainty surrounding US President Donald Trump’s tariff policy. Concerns about the displacement effects of artificial intelligence across software and broader industries intensified following a bearish Citirni Research report outlining potential AI‑related risks beyond the tech sector.
Although traders appear to be sidestepping some of the tech‑led declines as the so‑called “AI scare” trade moderates, markets remain unsettled by confusion over tariff developments. This follows Friday’s fallout after the US Supreme Court struck down President Trump’s original sweeping duties.
The US100 is attempting to consolidate following a 1.13% drop in the previous session, which pushed the index below the medium‑term ascending trendline drawn from the August lows. It currently sits just under the 38.2% Fibonacci retracement of the October 30 – November 21 pullback from the record high at 24,757. Strong support is expected at the 23.6% Fibonacci level near 24,400, while any bullish correction could see the index retesting the short‑term simple moving averages (SMAs) at 25,075 and 25,300 respectively.
Renewed tariff turmoil, US – Iran tensions – Gold
Gold is easing from a three‑week high near 5,250 as a firmer US dollar and profit‑taking weigh on prices following a rally driven by uncertainty over US tariffs and Middle East tensions. Investors are awaiting clarity on President Donald Trump’s tariff plans after the Supreme Court on Friday invalidated his previous global tariff regime. In response, the administration has implemented temporary 15% duties intended to address what it calls a balance‑of‑payments crisis – an assessment many economists dispute.
Market focus also remains on the US-Iran standoff ahead of a third round of talks, with the White House appearing to edge closer to potential military action over Iran’s nuclear program, including deploying additional warships to the region. Later today, President Trump is set to deliver the State of the Union address, adding another potential catalyst for volatility.
Gold is edging lower, snapping a four‑day winning streak, and is now testing strong support at 5,141 – the 61.8% Fibonacci retracement of the January 29-February 2 pullback from the record high – with the 20‑day SMA near the key 5,000 level as additional support. Despite short‑term softness, the broader outlook remains skewed to the upside, with the MACD and the RSI signals remaining in positive territory despite turning cautious. A rebound could target 5,342, with new highs above 5,420 still possible.
Takaichi rate‑hike view weighs on yen ahead of CPI – USD/JPY
The yen extended its softness against a stronger dollar as tariff concerns resurfaced and reports indicated Japanese Prime Minister Sanae Takaichi expressed reservations about further BoJ rate hikes during a meeting with Governor Kazuo Ueda. The yen’s post‑election rebound from February 8 has now faded, reviving the “Takaichi trade” amid worries that fiscal expansion could weaken the currency further.
Ongoing yen weakness also sharpens focus on inflation ahead of Friday’s Tokyo CPI. Fiscal measures announced so far are unlikely to keep inflation anchored at the BoJ’s 2% target, while recent data suggest earlier cost‑push pressures are easing. Persistent currency softness could bring forward expectations for the next BoJ rate increase—from December to as soon as April.
USDJPY is nearing an upside breakout from a symmetrical triangle, testing two‑week highs around 156.30. Momentum remains limited, with the RSI hovering near neutral at 50 and the MACD still below zero. A daily close above the 50‑day SMA, aligning with the triangle’s upper boundary, would open a path toward 157.60. Conversely, a drop below the 20‑day SMA could expose the psychological 154.00 level.
