Markets Brace for Earnings Week as Dollar Rebounds, Oil and Metals Extend Losses – Daily Market Comments from Century Financial

Vijay Valecha, February 2, 2026, Middle East News 247

U.S. Markets

The SPX index closed last week higher by 0.34% and is trading around $6,858 in today’s session.

This week will be defined by key earnings, especially tech heavyweights Alphabet and Amazon. Focus will be on forward earnings and capex guidance. Pharmaceutical companies Pfizer, Novo Nordisk and Eli Lily will also report earnings this week. For the macro calendar, attention will turn to the ISM Manufacturing PMI today. This sector is showing signs of improvement; however, with the reading still below 50, it is in contraction. Major labour market readings are also up for release, including Tuesday’s JOLTs report and Wednesday’s ADP Employment report. The highlight of the week is Friday’s NFP report. A strong 70k increase is currently forecasted for the latter, maintaining the recent trend of positive prints. Equity markets might face headwinds from ongoing weakness in the commodity markets.

From a technical perspective, the 50-day SMA is likely to offer support at $6,857, followed by $6,843. A resistance test is possible at the 21-day SMA level of $6,925, with the next test at $6,977. A sustained hold above $6,950 would be required for further momentum. Positive earnings releases this week, especially from tech companies, will be essential to the index’s possible upside.

U.S. Dollar Index

The U.S. dollar index rose 1% on Friday, continuing its recovery from recent lows as global markets adjusted from stretched positions. Today, the index is steady in the Asian session, trading near 97.175. Increased volatility in gold and silver has hurt risk appetite, leading to declines in metals, equities, and crude oil, and pushing short-term demand back to the dollar. As speculative trades against the dollar decrease, currency markets are shifting away from heavy dollar short positions, giving the DXY a mildly positive outlook for the day.

The drop in precious metals seems to be the main source of market stress, affecting global stocks and encouraging investors to move to safer assets. U.S. Treasuries are also seeing increased demand, which supports the dollar in the short term. In addition, the nomination of Kevin Warsh as the next Fed Chair helped start the dollar’s rebound by reducing concerns about a very dovish monetary policy, even though markets still expect the first Fed rate cut around mid-year.

However, the dollar’s rebound is still uncertain. Ongoing expectations of Fed rate cuts, and policy uncertainty in Washington mean that any gains may be short-term rather than the start of a new trend. Today, continued risk reduction and changes in market positions should help support the dollar, though gains will likely be limited. The EUR/USD pair may move lower as weaker metal prices and defensive demand for the dollar outweigh the euro’s underlying strength.

From a technical perspective, the DXY is trading around the 9 SMA, with potential resistance at 97.512. The index may find support at 96.825, a level previously tested. Support for the EURUSD pair remains at 1.185, while resistance is seen around 1.191

Crude Oil

WTI fell by 6% to $61.38, and Brent fell 5.81% to $65.52 per barrel as slipping geopolitical risk premiums triggered a broad unwind after a sharp rally.

The tamping down of earlier supply-disruption fears as Trump signals talks between the US and Iran. Along with OPEC+’s reiteration of March output, it served as a reminder that structural oversupply persists.

With no supply shock and recent price appreciation driven by risk premiums rather than demand, crude is experiencing a positioning shakeout. Now the market is weighing fading risk premiums against ongoing worries about oversupply, putting crude under pressure.

With no supply shock and recent price appreciation driven by risk premiums rather than demand, crude is experiencing a positioning shakeout. Now the market is weighing fading risk premiums against ongoing worries about oversupply, putting crude under pressure.

On the chart, Brent turned bearish following its rejection from the $69.5-$70.0 levels, as impulsive selling took out the previous higher low. Now, the price is pivoting at $65.40; below that, $63.28 will attract. On the upside, any bounce could face resistance at $67.20-$67.80.

WTI is similarly exhibiting a strong reversal from $66, having broken support. It is now pivoting at $61.30 with risk to the downside toward $59.21. On the upside, resistance is at $63.50. Both benchmarks remain bearish on the daily chart.

Gold and Silver

Gold extended losses after its biggest plunge in more than a decade of 9% on Friday. Silver also sank deeper after falling 26% on Friday, reversing a record-breaking rally that appeared to have run too far, too fast. Gold is currently down 8% while Silver is down 11%.

The trigger for Friday’s dramatic selloff was the news that US President Donald Trump would nominate Kevin Warsh to lead the Fed. This sent the dollar higher and undercut sentiment among investors who had bet on Trump’s willingness to let the currency weaken. Traders regard Warsh as hawkish for the economy as he is the toughest inflation fighter among the final candidates, raising expectations of tighter monetary policy that would underpin the dollar and weaken greenback-priced bullion. Further, the sell-off intensified when CME hiked its margin on gold and silver leading to a liquidity crunch.

Precious metals had risen to record highs at a rapid rate. An already-scorching rally accelerated sharply in January, over concerns about geopolitical turmoil, currency debasement and the Federal Reserve’s independence. A wave of buying from Chinese speculators further added to the rally. The extent to which Chinese investors buy the dips will play a key role in determining the direction of the market from here.

A record wave of purchases of call options was also mechanically reinforcing upward price momentum, as the sellers of the options hedged their exposure to rising prices by buying more.

For silver, waves of hot money in China have contributed to domestic supply tightness, but that may subside as the rout damps investment demand. Once the consensus expectation of a one-way rally is broken, shorts’ willingness to make delivery will increase, helping to ease the shortage. On Friday, iShares Silver Trust, the largest exchange-traded fund backed by, recorded more than $40 billion in turnover. That made it one of the most traded securities on the planet, when just months ago it would rarely see more than $2 billion traded.

From a technical perspective, a bearish bias exists on gold as it is trading below the 9 SMA on the daily chart and has an RSI of 27, indicating that the metal is oversold. On the 4-hour chart, immediate support is $4,476 followed by the 5th January 2026 breakout level of $4,395. Immediate resistance is at $4,652, followed by $4,768 which coincides with the 100 SMA.

Silver also has a bearish bias as it is trading below the 9 SMA on the daily chart and has an RSI of 21, indicating that the metal is oversold. Immediate support is at $70, followed by $64 and the $57 on the 4-hour chart. Resistance is at $86 and then at $92 (100 SMA level). A break above this level can solidify bullish momentum on silver.

Source

Middle East News 247