US equities mix on Friday, S&P 500 threatens a pullback

S&P 500, NASDAQ Composite end six-day record streaks.
Despite weaker Friday, US indexes closed in the green for a third straight week.
US Fed on the docket for next week.

Joshua Gibson FXStreet

US equities closed mixed on Friday to cap off a week of stunning record closes. Over-eager markets that have been leaning into rate cut bets in recent weeks second-guessed US economic conditions after US Personal Consumption Expenditure (PCE) Price Index figures showed cooling inflation, but consumer spending and housing activity hinted at a US economy that is too robust to allow for a rapid approach on Federal Reserve (Fed) rate cuts.

Money markets repriced odds of a first rate trim from the Fed to the Federal Open Market Committee’s (FOMC) meeting in May, with bets of a March rate cut down to 47% according to the CME’s FedWatch Tool.

US Core YoY PCE Price Index figures for December printed at 2.9% on Friday, below the forecast 3.0% and slipping back from the previous period’s 3.2%. Markets initially rose on reaction to the good news that cooling inflation might lead to faster, sooner rate cuts from the Fed, but an uptick in Personal Spending and Pending Home Sales put a damper on rate hopes.

US Personal Spending rose 0.7% in December compared to the 0.4% forecast and 0.4% previous (revised from 0.2%), and Pending Home Sales jumped 8.3% in December compared to the forecast 1.5% and -0.3% previous (revised from 0.0%).

Revenue forecasts on Wall Street missed expectations for major tech stocks including Intel and chipmaker tool manufacturer KLA Corp, causing equities to rethink recent bullish momentum on tech hopes alongside recent declines in tech darlings Tesla and Apple.

The Dow Jones Industrial Average (DJIA) gained 60 points to close up 0.16% at $38,109.43 while the Standard & Poor’s 500 (S&P) Major equity index closed down 0.07%, shedding a little over 3 points and ending Friday at $4,890.97.

The NASDAQ Composite declined on tech stock hesitancy, losing 55 points and closing down by a third of a percent at $15,455.36.

S&P Technical Outlook

The S&P closed in the green for a third straight week, chalking in 12 winning weeks out of the last 13, and the major index is up nearly 20% from the last significant swing low into $4,102.02 in October.

The S&P 500 is trading well above the 200-day Simple Moving Average (SMA) near $4,425.00, and is in play near the $4,900.00 as investors eye another push towards the $5,000.00 major handle nearby.

S&P 500 Hourly Chart

S&P 500 Daily Chart

SP 500

Overview
Today last price	4887.06
Today Daily Change	-7.85
Today Daily Change %	-0.16
Today daily open	4894.91

Trends
Daily SMA20	4780.78
Daily SMA50	4689.34
Daily SMA100	4512.25
Daily SMA200	4430.71

Levels
Previous Daily High	4896.6
Previous Daily Low	4865.96
Previous Weekly High	4839.58
Previous Weekly Low	4714.37
Previous Monthly High	4794.65
Previous Monthly Low	4542.87
Daily Fibonacci 38.2%	4884.9
Daily Fibonacci 61.8%	4877.66
Daily Pivot Point S1	4875.05
Daily Pivot Point S2	4855.18
Daily Pivot Point S3	4844.41
Daily Pivot Point R1	4905.69
Daily Pivot Point R2	4916.46
Daily Pivot Point R3	4936.33

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.