Although trading volumes are unsurprisingly starting to fall off ahead of Christmas, volatility is still around as markets grapple with the double prospect of inflation and interest rate rises yet to come.

Although major stock market indices such as the S&P 500 are broadly unchanged from where they were trading a week ago, this hides the big swings that have been seen on a day-to-day basis. Up one day, then down the next has been the theme this week as traders still seem unable to figure out just what the beginning of 2022 will look like.

With inflation proving stickier than expected, and the Bank of England already having made its opening gambit for rate rises, figuring out whether next year is going to be different from the overall smooth upward progress stocks experienced this year is a tough call.

The S&P 500 has risen by around 23% this year, and there hasn’t been much in the way of major sell-offs or panics. Perhaps this smooth performance will continue in the New Year. Still, with the question of just how long this higher inflation lasts, it is not surprising that some traders will be betting on higher volatility than markets have experienced in recent months.

What has not moved that much is the price of gold. It’s an old market cliche that the yellow metal does well in times of higher inflation as some investors use it as a store of value and a hedge against rising prices. But gold is still down by around 5% this year and continues its fairly unexciting daily trading ranges.

The gold bugs will be hoping that there is just a delay here before investors see the error of their ways and pay their favorite market a bit more attention. But perhaps the newer breed of traders who have entered the markets over the past 18 months see gold as something just for the boomers, and Bitcoin remains the alternative market of choice.

But even this crypto favorite has slid by around 40% over the past six weeks - and in fact, is trading where it was in February. Whatever 2022 has in store, with more unknowns than we have had for a while around the economy, it promises to be anything but boring.

Disclaimer: This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors, not necessarily Capital.com or any of its affiliates, subsidiaries, officers, or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds. Past performance is no guarantee of future results.