Markets Slow Ahead Of Holidays

Good morning, Traders!

The global markets continue to obsess about the potential for recession, and so there’s more focus than usual on CPI number in the economic calendar, as well as confidence and housing indexes.

For the time being, these can inject more volatility into the markets.

There’s also an interesting phenomena that occurs seasonally known as the Santa Rally where the global markets can become bullish around the prospect of increased production in line with the holiday spending, but so far, and taking most of this year into account, there are few signs of any rallies just yet.

There could just be a fatigue and that everyone needs a holiday, hahaha!

Bank of Japan bucks the “rate hike” trend

A few charts that are interesting to look at, not least of all the Bank Of Japan’s recent monetary policy announcements.

The BoJ opted to keep Monetary Policy steady, by maintainingshort-term interest rate target at0.1%, and maintain a their 10-Year JGB yield targetsaround 0%.

The result of this has seen JPY charts head significantly lower, and which could remain that way into the New Year.

To see the impact in context, here are the USDJPY, GBPJPY and EURJPY charts:

The sharp drop can be clearly seen impacting the major markets.

This is likely to generate activity with traders engaging in some areas, and is also a good example of how extreme some moves have been this last year.

The B.O.J. don’t appear too concerned at this time. It seem that central banks prefer not to interfere with markets unless they really have to.

U.K. markets’ mood optimistic ahead of Christmas

Looking at the FTSE100 in the UK today, the markets have been optimistically closing near the all time highs. Given the general sentiment out there, this is actually worth a round of applause.

The U.K. does not always enjoy the same rate of growth as the U.S. but it’s good to see it trying to push higher in recent weeks.

Will it be able to break out to new all-time-highs in 2023? That’s something to toast to on New Year’s eve!

Many traders will use this holiday time to take a break from the charts, but focus on reading books, listening to pod-casts, or anything that will recharge their batteries before the pace of life speeds up again.

Taking time to create a trading plan really can make a big difference when the time comes to act,

On that note, have a great day, and happy trading!

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