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After some exciting upside that saw gold reach $1900 per ounce late this week, the yellow metal pulled back slightly Friday as traders likely chose to book some profits. Although gold finished the day session down, it did not end up at the lows of the day as buyers seemingly stepped in to buy the dip. The metal may have also been bought off the session lows as traders eyed Ukraine nervously heading into the weekend.

Stocks have seen some movement to end the trading week as well. In late afternoon action, the benchmark Dow Jones Industrial Average is down nearly 200 points. Today’s equity declines come on the heels of major declines in yesterday’s session. The bears are in control of stocks on the daily chart currently, and the path of least resistance is sideways to lower prices.

Dominating the financial headlines this week was the possibility of a Russian invasion of Ukraine. Russia has amassed some 150,000 troops along the Ukrainian border and it is difficult to imagine why the country would park such a large force there if it did not intend to invade. The U.S. has said that it believes an invasion is imminent. Any increases in hostilities over the weekend could have dramatic consequences for markets when they reopen Sunday evening. While the U.S. has intelligence that Russia plans to invade, Russia has said it has no intention of invading its neighbor. Adding to global anxiety over the potential for armed conflict, Russia today announced that it will be conducting nuclear drills.

The biggest wildcard for this situation now is how an invasion could be responded to. The U.S. and its allies have suggested that further sanctions against Russian interests could be administered, but the possibility of a ground war is the biggest concern. Any U.S. response to an invasion of Ukraine would likely depend on the severity of the invasion. If Russia sends all 150,000 troops into Ukraine at once, a response could be swift and severe, leading to an armed conflict the likes of which has not been seen in some time. A smaller incursion of Russian forces, on the other hand, may only garner additional sanctions or another economic punishment as a deterrent.

Markets are not only concerned about a possible war, but are also very worried over ongoing inflation pressure. This week saw several “hot” inflation reports, suggesting that inflation may now be entrenched and it could take some serious time and action from central banks to reverse it. The first such action is very likely to happen in the coming weeks. The Fed could be gearing up for a half-point interest rate hike next month or possibly sooner. This would be the first such hike since 2000 at which time the dot.com bubble popped. Stocks could react in a very similar fashion this time around as well. The bears are already pushing equities lower and the path of least resistance remains sideways to lower.