A bit of a dinky trivia. If you flip the date today the other way around, it still reads out 22022022.
And now, back to the thread. Well, Russia-Ukraine tensions are continuing to play out and the big question now is what comes next?
I would argue the base case is that Russia gets their claim of the separatist land, with the borders to be worked out in detail next. Ukraine will display some furiousness over the matter but there likely won't be any aggressive maneuvers. After which, it depends on how far Russia wants to push the narrative. Is this all about Donbass? Or are they going for more?
We could see Putin try to poke and prod a bit but perhaps not go all the way. The West will draw up insignificant sanctions on Russia and the world will slowly move on thereafter.
But we'll see how that all plays out. As such, I would wager that we haven't exactly reached peak fear in markets just yet. The S&P 500 is starting to tumble towards the January lows and that will make things more interesting technically. There might be scope for an even deeper correction but the play in all of this is to look for the dip buy on the relief rally.
However, part of me feels that any relief rally will also be snuffed out quite easily considering the Fed will slowly become the next main focus alongside the inflation narrative for the year.
In that lieu, gold shorts would also be one to look at and in turn, yen pairs as well on the long side. The aussie and kiwi have been surprisingly resilient throughout this whole ordeal and I reckon there might be an even stronger bounce beckoning once geopolitical tensions subside. Those would be the big plays I'm watching.
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