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Fed Chief, Powell, confirmed it will complete its monthly bond-buying in March and signalled a rate hike for the same month. It plans to let bonds mature as a method to reduce its balance sheet over time and has not decided on the timing and pace of balance sheet reduction. It restated that inflation is high and well above the Fed's target. It added, the US economy no longer needed a sustained high level of policy support. In sum, the Fed made no particular change to its previous communications. US Fed futures imply 4 rate hikes. The yield on the US 10 year Treasury Note stands at 1.84%, up from 1.78%. Markets are volatile and significantly lower following Fed Chair's press conference.

Results from latest AAII Sentiment Survey show market participants are now extremely negative (bearish), the highest in 16-month. Similarly, bullish sentiment fell to an 18-month low. This widely followed measure of the mood of individual investors is an interesting contrarian indicator that suggests we may be nearing the end of the market flush. Lastly, as significant damage has occurred on the charts, markets could take some time to regain their positive trend.

Gold is back on the spotlight as the yellow metal is holding firmly near the highest level in more than two months, outperforming all other major assets. Indeed, the SPDR  gold shares ETF (GLD) had its biggest inflows in dollar terms (see our newsletter of 25.01.2022). Markets are experiencing volatile sessions as investors are waiting for the outcome of a Federal Reserve meeting this afternoon. Furthermore, the risk of a Russian invasion of Ukraine and a cut in the IMF's world economic growth forecast for this year are also aiding the safe haven asset. For more in-depth research on gold please see our market insight's section on commodities.

Although Amazon shares have fallen to their lowest level since July 2020, dragged down by the recent risk-asset selloff, analysts are remaining bullish. The spread between Bezos's baby share price and analysts targets has increased substantially, close to USD1'250! With earnings (3rd February) in sight, all eyes will be on company's growth in cloud services, which could stay above 35%. All analysts that cover Amazon recommend buying the stock. To note that the drop in Amazon shares price is partly due to news that the company is experiencing high employee turnover, a trend that can be seen among many other companies in the industry. Given Amazon's solid performance so far, this should be a short term issue.

Technicals begin to show positive signs with the S&P 500 reaching oversold levels, but carving a support level can take time. The index could continue lower to touch a more significant low. The momentum indicator RSI stands at 28.55, marking oversold levels. On a daily chart, the reading is lower at 25, the lowest level in 22 months. Tuesday market session showed signs of capitulation with markets rallying significantly from intra-day lows. Finally, Friday's Equity Put/Call ratio hit above 1.0, suggesting we are getting close to possible trading lows. FOMC on Wednesday could offer some visibility. With significant damage on the charts, marking a bottom could take some time as buyers may be cautious to jump back in so quickly. That said, reassurance around corporate margins and clearer Fed guidance could be very constructive for markets to find support.