FXTM information and reviews
OctaFX information and reviews
XM information and reviews
FXCC information and reviews
Libertex information and reviews
HFM information and reviews

Markets kick off 2022 in style

5 January 2022 Written by Lukman Otunuga  Senior Research Analyst at FXTM Lukman Otunuga

Global investors have entered the new year in a cheerful mood. U.S futures and European stocks flashed green on Tuesday, extending a solid start to 2022 as concerns over the Omicron variant eased. Equity bulls are likely to remain in the driving seat if improving economic data fuels hopes around a steady economic recovery despite a surge in Covid-19 cases.

The next few days promise to be eventful with global markets thanks to the OPEC+ output decision later today, FOMC meeting minutes on Wednesday, and key US jobs data on Friday. On top of this, major economies will be publishing key data throughout the week, complemented with speeches from Fed policymakers. At the end of our 2021 market review, we advised you to fasten your seatbelts for another eventful year. If you have not already done so, it’s not too late.

Will the dollar remain king in 2022?

As 2022 kicked off, I found myself pondering whether the mighty dollar would rule the FX arena this year. We highlighted in our 3 major themes for 2022 how the dollar could be a potential winner. Indeed, the Fed indicating that they could raise interest rates 3 times in 2022 is a welcome development for the dollar.

We are only two days into 2022 and the dollar is flexing its muscles in the FX space, appreciating against all G10 currencies with the Dollar Index (DXY) hovering around 96.40 as of writing. From a technical perspective, the DXY has the potential to push higher if a daily close above the 96.90 resistance level is achieved.

EURUSD destined to tumble?

The monetary policy divergence between the Federal Reserve and European Central Bank will most likely influence the EURUSD’s outlook for 2022. Given how the Fed is seen tightening policy much faster than the ECB, this could weigh heavily on the EURUSD. Looking at the charts, the currency pair remains in a range with support at 1.1200 and resistance at 1.1370. A strong breakdown and daily close below 1.1200 could signal further downside with 1.1093 acting as the first point of interest.

Will gold bears dominate the scene?

A stronger dollar and prospects higher interest rates make a toxic cocktail for zero-yielding gold. The precious metal concluded last year 3.64% lower and entered 2022 on a shaky note. Gold could transform into a fierce battleground for bulls and bears this year as investors juggle with Covid-19 developments, inflation fears, and Fed hike expectations among other themes. In the meantime, the precious metal’s near term outlook could be impacted by the key US jobs data on Friday.

Looking at the technical picture, the $1800 psychological level remains a key point of interest. Should this level prove to be reliable support, a move back towards $1831 and $1845 could be on the cards. Alternatively, a decline below $1800 may open the doors towards $1786 and $1770, respectively.


Share: Tweet this or Share on Facebook


Santa Rally: Your Christmas Gift From The Stock Market
Santa Rally: Your Christmas Gift From The Stock Market

Christmas is a religious holiday that has evolved into a cultural and commercial celebration with tales of Santa Claus delivering presents on a reindeer-pulled sleigh through the night sky...

7 Dec 2022

Citigroup heading for UAE
Citigroup heading for UAE

One of the largest and most famous banks in the world is Citigroup, headquartered in New York City… at least, for now. There have been some employee movements...

6 Dec 2022

XAU/USD upside appears more compelling ahead of US NFP
XAU/USD upside appears more compelling ahead of US NFP

Gold price consolidates recent gains around four-month high after crossing the key resistances. Cautious mood, US Dollar rebound allows XAU/USD bulls to take a breather...

2 Dec 2022

Oil’s correction in rumors about further production cuts by OPEC
Oil’s correction in rumors about further production cuts by OPEC

The price of Crude oil resumed the downward movement after failing to cross above the daily trendline which was valid since late June.The price only rebounded to the upside...

1 Dec 2022

The Downfall of Euro in 2022: the Analysis of its Reasons, the Current Situation, and the Objective Forecast
The Downfall of Euro in 2022: the Analysis of its Reasons, the Current Situation, and the Objective Forecast

Before getting down to analyzing why Euro reminds of a mafia victim in cement shoes falling off a Chicago bridge, allow us to open it up with a meme joke that best describes this whole ordeal...

30 Nov 2022

Is Boeing stock about to take off?
Is Boeing stock about to take off?

Boeing stock (BA) has been in free fall since March 2021, from $269 (USD) dropping to $121 at the end of September 2022. And then came a reversal, raising prices to over $175...

29 Nov 2022

Editors' Picks

FXCM information and reviews
ActivTrades information and reviews
RoboForex information and reviews
MultiBank Group information and reviews
MultiBank Group
FxPro information and reviews
Vantage information and reviews

© 2006-2022 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.