US stock markets are seemingly pressured, with the S&P 500 down by about 1.1% and Nasdaq lower by 0.6% in European trading, as the situations with the collapse of the Silicon Valley Bank and the New York-based Signature Bank continues to develop.

Depositors of the SVB bank will access their money on Monday, according to a joint statement by the Federal Reserve, FDIC, and Treasury Department. Additionally, the Fed will establish a funding program to offer loans with yearly maturities.

The Federal Reserve might continue with the pace of the interest rate hikes while speculations arise about a potentially dovish tone towards a 25 bps hike due to the current banking situation while it may play into the monetary plan to weaken the economy to fight inflation, depending on the upcoming closed-door Fed Emergency Meeting in the New York trading session.

Gold and the Japanese yen playing their role as hedge against the pressured stock markets – the precious metal is up by about 2.1% and the yen rose 1.9% against the dollar. Another winner was Bitcoin which soared about 7.5% against the dollar in yesterday’s weekend session.

The lower dollar, which fell by about 0.6% in the European trading session, gives mixed signs to support equity and commodity markets as the volatility is positive with about 20% for the ES futures contract, indicating selling. Gold benefits from the lower dollar for the very moment.

The central bank may decide to trigger a dovish event that would be around and confluent with a technical supportive area on the daily interval of the E-mini S&P 500 to reverse the market, depending on the outcome of the closed-door meeting today. In case to favor the fight against inflation, the market may drop through the decade’s VWAP with a supportive stance towards the dollar.

Interesting supportive confluence of Bitcoin’s technical buying around the lower extreme of the Quarter’s and Year’s lower value extreme with the banking event. The current bullish effect on Bitcoin, Gold, and Yen may depend on the mentioned Fed’s meeting conclusions and operations toward a hawkish or dovish stance.

More By This Author:

Dollar Soars To Multi-Month Highs Due Hawkish Monetary Outlook
Potential Higher Interest Rate Hike Pace Let Markets Drop
Durable Goods Lower-Than-Expected Boosting US Stock Markets