**Increased Volatility in the Forex Market** In the world of cryptocurrency, meme coins such as Dogecoin, Shiba Inu, and Pepe are under pressure, testing their monthly support levels during a broader market decline. In contrast, Zcash remains strong, trading around $360 as positive sentiment continues to grow. The recent US-China trade talks between Trump and Xi concluded without surprises, primarily discussing tariff reductions on fentanyl and the restart of US soybean exports. A key part of this agreement is China’s decision to delay export controls for another year. There’s a lot of uncertainty about what the Federal Reserve will do next, creating a fertile ground for volatility opportunities. Although the likelihood of a rate cut in December has risen to over 70%, the latest US Core PCE inflation rate stubbornly stands at 3.5%, significantly above the target. This mismatch between actual data and expectations suggests that strategies like straddles on the SPX or major currency pairs could work well. Gold continues to hold above the important $4,000 mark, a level we haven’t seen since the inflation and geopolitical issues of 2024. This high price reflects strong demand for a safeguard against uncertainty and potential currency devaluation. If the Fed signals a more dovish stance in the coming weeks, we could see gold prices rise further. **Japanese Yen and Global Forex Movements** In Japan, a slight increase in retail sales does not change the overall situation for the yen. The Bank of Japan decided to keep its negative interest rate policy in October, widening the gap in monetary policy compared to other central banks. We believe shorting the yen remains a straightforward trading opportunity, especially against currencies from countries with stricter monetary policies. The EUR/JPY pair is hovering near its all-time high of 178.00, clearly reflecting this policy divergence. The European Central Bank’s current rate of 3.0% aims to combat inflation, which is still above 3%. This creates a solid case for a robust euro against a weak yen. We anticipate that dips in this pair will be quickly bought. The British Pound finds itself in a tough spot, trading sideways above 1.3150 as it waits for direction from the US. Recent UK inflation dropped unexpectedly to 4.1%, putting the Bank of England on hold. This means the direction of the GBP/USD pair largely depends on upcoming US jobs and inflation reports. Lastly, the managed trade relationship between the US and China is easing a significant source of global market risk. This newfound stability may lower volatility, potentially making long-premium option strategies more costly. We are closely monitoring whether this calm shifts investment away from safe-haven assets like the US Dollar and into global stocks. Create your live VT Markets account and start trading now.

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