It’s a relatively straightforward risk positive day as markets carry over the mood from Friday. Here’s a snapshot of the equities space at the moment:

• Eurostoxx +1.4%
• Germany DAX +1.3%
• France CAC 40 +1.4%
• UK FTSE +1.4%
• S&P 500 futures +1.0%
• Nasdaq futures +1.2%
• Dow futures +0.9%

There isn’t much else for traders and investors to work with but the scraps and pieces from Friday last week. But as much as we are seeing risk optimism and the dollar losing some notable ground, best be wary that it might not take much for things to switch around.

There are still risk headwinds in the form of recession fears and Europe still has a potential gas crisis looming. Meanwhile, while market players are focused on the 75 bps vs 100 bps debate on the Fed, let’s not forget that the central bank is still poised to raise rates towards the region of 3.50% and 4.00% potentially. As soon as the above debate is over and done with, the point of the terminal rate is arguably still reason enough to keep the dollar in a good spot, all things considered.

This article was written by Justin Low at www.forexlive.com.