The S&P Global Services PMI for the UK in November reached 51.3, which is higher than the expected 50.5. This shows that the services sector is expanding since the PMI is above 50. In other economic news, the US saw a drop in ADP Employment Change by 32,000, while a gain of 5,000 was expected. Additionally, the EUR/USD pair is climbing, aiming for 1.1700, supported by different expectations for monetary policy from the Fed and the ECB.

Gold’s Positive Movement

Gold prices rose above $4,200 per troy ounce, riding a wave of positive sentiment in the equity market. Chainlink’s LINK also gained nearly 7% after Grayscale launched its ETF, with futures Open Interest increasing by over 20%. The White House is getting ready for potential changes to IEEPA tariffs, suggesting that exporters should prepare for these tariffs to stay around. Also, in the cryptocurrency world, Bitcoin jumped almost 8% to above $92,000, which led to strong performance in altcoins like Pudgy Penguins, Sui, and Pump.fun. Vanguard’s approval of crypto ETFs on its platform contributed to this crypto asset surge. The surprising drop in US employment, with a loss of 32,000 jobs instead of the expected gain, is causing the dollar to weaken significantly. As a result, market expectations have shifted, with fed funds futures now indicating a 75% chance of a rate cut at the January 2026 meeting. Traders might want to consider options or futures to take advantage of further declines in the dollar.

UK Economic Resilience

The UK services sector shows unexpected resilience, with a PMI of 51.3, in contrast to the struggling US labor market. UK inflation data from the ONS last month held steady at 3.1%, which gives the Bank of England less reason to think about rate cuts compared to the Fed. This difference creates an opportunity to buy call options on GBP/USD or set up long futures positions. The EUR/USD has climbed to two-month highs near 1.1700, primarily due to expectations of a more dovish Federal Reserve. With Eurozone core inflation at 3.3% in its latest reading, the European Central Bank is likely to maintain its current position for a longer time. This policy divergence makes long positions in euros against the dollar appealing in the coming weeks. Gold’s rise above $4,200 per ounce reflects the weak dollar and increased demand for safe assets amid economic uncertainty. Market volatility has increased, with the VIX index reaching 19, a notable rise from its lows earlier this year in mid-2025. Traders may consider using gold call options to gain exposure while managing risk. Despite the unfavorable economic data, riskier assets like crypto are rallying strongly, with Bitcoin surpassing $92,000. This surge is driven by growing institutional acceptance, such as Vanguard’s decision to allow crypto ETFs. The market believes that a slowing economy will lead the Fed to inject more liquidity, which has historically benefited these assets. Create your live VT Markets account and start trading now.

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