The Royal Institution of Chartered Surveyors (RICS) shared its Housing Price Balance for November, reporting a -16% outcome. This is better than the expected -21%, suggesting a more hopeful outlook for the housing market. Fewer surveyors reported falling house prices than those who noted increases. In other news, the GBP/USD exchange rate dropped to about 1.3365 during the early European session. The USD/INR increased significantly amid uncertainty in US-India trade talks. Meanwhile, the Japanese Yen weakened against a strengthening US Dollar. The EUR/USD pair is trading around 1.1690 after the Federal Reserve’s dovish rate cut. The GBP/USD pair remains under pressure, also near 1.3365, due to the US Dollar’s recovery. Gold prices have fallen from a recent high, attributed to a positive risk sentiment and a slight rise in the US Dollar. Solana’s price dipped below $130 after the hawkish rate cut from the Federal Reserve. The Federal Open Market Committee predicts that interest rates will average 3.4% by the end of 2026. In contrast, Hyperliquid is trading above $28.00, bouncing back from $27.50, even as market losses continue ahead of a Fed monetary policy decision. The Pound is weakening as the Bank of England is expected to cut rates next week. With UK inflation recently easing, mirroring trends from late 2023 when CPI fell to 3.9%, the market is largely anticipating a 25 basis point reduction. This creates an opportunity for options strategies, like a long strangle on GBP/USD, to take advantage of any surprises from the BoE. The unexpected result from the UK housing survey, showing a -16% balance instead of the projected -21%, indicates that pessimism in the property market may have peaked. This resembles trends from 2023, when the index began to recover from a low of -67%, historically benefiting domestic sectors. Therefore, buying call options on UK homebuilder stocks or the FTSE 250 index could be a good way to position for a possible short-term rebound. The US Dollar is gaining ground as the Federal Reserve, although cutting rates, has indicated a slower pace of easing moving forward. The interest rate swaps market now suggests only 50 basis points of cuts for all of 2026, a downgrade from the previous 100 basis points priced in only a month ago. This indicates that selling short-dated call options on EUR/USD might be a smart strategy to take advantage of the renewed strength of the dollar. Gold has retreated from a weekly high of near $4,250 as the dollar strengthens and the Fed raises its GDP forecasts. This dip might be a buying opportunity, as the broader global trend continues towards central bank easing, a lesson we’ve learned since the post-2008 period. Given the record levels of gold purchases by central banks in 2022 and 2023, selling put options at lower strike prices could allow for a more favorable entry into a long position.

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