In October, personal spending in the United States went up by 0.5%, following a 0.3% increase the month before. This rise in consumer spending shows how people’s economic behavior and purchasing power are changing. Market reactions were mixed as the US dollar weakened, affecting currency pairs like USD/JPY and EUR/USD. Meanwhile, gold prices soared to record highs, exceeding $4,900 per troy ounce, partly due to the falling dollar value.

Crypto Market Trends

In the crypto market, Bitcoin’s price climbed slightly above $90,000. This happened even though there was selling pressure related to ETFs impacting other cryptocurrencies like Ethereum and XRP. XRP held steady at $1.90, benefiting from new investments even as retail demand remained cautious. Recent global events have changed trade relations between the US and EU. President Trump eased possible risks by canceling a proposed tariff increase on NATO countries. These actions affected market feelings, helping boost Forex and commodities. Although personal spending data for October 2025 indicates growth, the market is clearly focused on the falling dollar. More recent data from late 2025 shows that the Core Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s favorite inflation measure, cooled to a 2.9% annual rate in December. This cooling trend suggests the central bank may have less reason to keep its tight policies, putting additional pressure on the dollar.

Gold and Currency Positions

The rise in gold prices to nearly $5,000 per ounce, despite a general risk-on sentiment at the end of last year, was significant. This trend is linked not only to geopolitics but also to ongoing dollar weakness and market expectations of rate cuts. We might consider using call options on gold futures to gain potential exposure if prices break above $5,000 in the coming months. Our trades in currency pairs like EUR/USD and GBP/USD have been successful, benefiting from continued dollar weakness observed in the last quarter of 2025. This trend is likely to continue as long as US inflation data remains lower than Europe’s. In the upcoming weeks, we can look to strengthen these long positions on any dips, possibly using short-dated options to manage risk around important economic data releases. The easing of US-EU trade tensions in late 2025 led to a decline in implied volatility, evident as the VIX index fell below 14 for a sustained time. This low-volatility climate makes selling puts on stock market indices an appealing strategy. Since markets remain risk-on, this is a practical approach to earn some premium. Create your live VT Markets account and start trading now.

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