Markets end 2020 in “risk on” mode


Macroeconomic/ geopolitical developments

  • Trump finally signed the $900 billion COVID relief bill, a relief for markets.
  • The EU-UK trade deal finally got done over the holiday season and was implemented at the end of 2020.
  • Europe and the USA are still seeing aggressive increases in the numbers of cases, hospitalisations and deaths from COVID-19, as the new variant first identified in the UK is now being seen around the globe.
  • More stringent lockdowns that have been seen in Europe, the UK and in the US through the holiday season are likely to extend into January and likely beyond, with the threat of still more aggressive policies.
  • The Pfizer vaccine is being delivered to the global population at various speeds, with the UK due to start delivering the Astra Zeneca/ Oxford University vaccine this coming week.

Global financial market developments

  • Global stock indices ended 2020 at or near new cycle peaks and even saw record highs posted by the German DAX and the major US equity averages (the S&P 500, the Dow Jones Industrial Average and Nasdaq).
  • The “risk on” phase has continued in the Forex space, which saw the safe haven US Dollar weakening across the FX board.
  • Risk currencies” went still higher as the Australian, New Zealand and Canadian Dollars all strengthened, with the AUDUSD and NZDUSD Forex rates hitting new multi-year highs.
  • GBPUSD advanced to a new multi-month high with the EU-UK trade deal done, whilst EURUSD stayed strong, through slightly dipping to end 2020.
  • In the commodity space, Gold and Oil were modestly higher to end the year, with Copper sideways, but solid.
DAX New High

Key this week

  • Geopolitics:
    • Key this week will be the Georgia Senate runoff elections on Tuesday 5th January.
    • OPEC+ meets Monday to decide oil production levels
    • The UK is due to start delivering the Astra Zeneca/ Oxford University vaccine this week
    • Markets will monitor further vaccine delivery announcements and approvals.
    • COVID-19 cases, hospitalisations and deaths stay in focus in Europe and the US.
    • Watching for new lockdown measures.
  • Central Bank Watch: TheFOMC Meeting Minutes are on Wednesday.
  • Macroeconomic data: A very busy data week with the standouts being the global manufacturing and services PMI data Monday and Wednesday respectively, the US ISM manufacturing and services PMI on Tuesday and Thursday, then the US Employment report Friday.
DateKey Macroeconomic Events
04/01/21OPEC+ Meeting; global Markit manufacturing PMI
05/01/21German Retail Sales and Unemployment rate; US ISM manufacturing PMI; Georgia Senate runoff elections
06/01/21Global Markit services PMI; ADP Employment change; FOMC Meeting Minutes
07/01/21German Retail Sales and Unemployment rate; US ISM services PMI
08/01/21US Employment report; Canadian Employment report

Editor in chief

Steve Miley is the Market Chartist and has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Mar... Continued

Comment on this video

Your email address will not be published. Required fields are marked *

Latest Related News

US Dollar recovery theme continues, US earnings mostly inspire

Macroeconomic/ geopolitical developments President Joe Biden’s inauguration passed without any notable incident, which was likely a relief for financial markets.Four central banks were in play last week, with modest signals from the Bank of Canada and the European Central Bank of less dovish, de facto minimally more hawkish tones.Earnings season played a significant role, with most banks and financials beating expectations, whilst Netflix was extremely… Continued

US Dollar sending mixed signals

Negative on Dollar Index (DXY) and positives on Euro (EURUSD)Euro future holds weekly support (EURUSD)Fresh buy signal on Dollar-CAD (USDCAD) connects with weakness in oil Continued

Q1/Q2 Elliott Wave views for the Forex Majors – Exclusive interview with Jim Martens!

Here is an in-depth interview with Jim Martens, Elliott Wave International's (EWI) Senior Currency Strategist and editor of the trader-focused Currency Pro Service. In this interview, we will discuss the Major currency pairs, including EURUSD, the US Dollar Index (DXY), GBPUSD, USDCHF, USDJPY, AUDUSD and USDCAD. Here is a link to a free report on trading FX with EWI. It’s normally $79 and not available on… Continued

Dollar switches trend to up

US Dollar Index aims higher (DXY forecast)Euro breaks down - EURUSD forecastMajor negatives appear on Pound (GBPUSD forecast) and Aussie (AUDUSD forecast) Continued

Bullish into 2021 with blue sweep confirmed

Macroeconomic/ geopolitical developments The Democrats won both seats in the Georgia Senate runoff elections from Wednesday, confirming a “blue sweep”, the Democrats now taking control of both houses of Congress alongside the presidency. Then, Thursday saw unprecedented and shocking events in Washington DC, with Trump supporters storming the Capitol building. The fact that President Trump appeared to incite this activity has seen his social media… Continued

Forex Brokers in your location


72% of retail investor accounts lose money when trading CFDs with this provider.


74-89% of retail investor accounts lose money when trading CFDs with this provider.


75% of retail investor accounts lose money when trading CFDs with this provider.


76.4% of retail investor accounts lose money when trading CFDs with this provider.