Ireland’s AIB Services Purchasing Managers’ Index (PMI) fell from 58.5 in November to 54.8 in December, showing a slowdown in the services sector. A value above 50 still suggests growth, but this drop indicates a loss of momentum. In the wider financial market, there are notable changes. Gold prices reached a one-week high as more investors seek safe-haven assets due to geopolitical tensions and potential Federal Reserve rate cuts. At the same time, the GBP/USD pair rose to a three-month high, trading around 1.3560, showing signs of continued upward movement.

Cryptocurrency Market Trends

In cryptocurrency, Solana reached over $137 after a 7% weekly rise, fueled by strong demand for spot exchange-traded funds (ETFs) that saw over $16 million in inflows. Ripple also saw gains, climbing past $2.13, thanks to ongoing interest and ETF inflows, despite geopolitical concerns. The EUR/USD pair is continuing to rise, surpassing 1.1735 during the Asian market session. As these trends unfold, markets remain sensitive to geopolitical and economic factors, emphasizing their volatile nature. Ireland’s Services PMI dropping to 54.8 still indicates some growth but reflects a broader cooling trend we observed across Europe in late 2025. This slowdown means the economy isn’t stalling, but growth is slowing down. It may be a good time to look into protective put options on European stock indices to guard against further declines. Geopolitical tensions are driving a rush for safety, pushing gold to weekly highs near $4,450. This mirrors market behavior seen at the beginning of the Russia-Ukraine war in 2022 when uncertainty drove investment into hard assets. This situation suggests we should maintain long positions in gold, possibly with futures or call options on gold-backed ETFs.

Expectations for Federal Reserve Decisions

Expectations for Federal Reserve rate cuts are becoming firmer, which is weakening the US dollar. This situation supports the strength of pairs like GBP/USD, which has climbed to a three-month high of 1.3562. The trend seems to favor a weaker dollar, making it appealing to consider strategies that short the USD against the pound and euro. However, the pound’s strength may be running out of steam, as technical indicators like the Relative Strength Index are nearing overbought levels. This hints that the current rally might pause or reverse soon. Strategies such as buying straddles on GBP/USD could be useful to take advantage of a potential sharp move, no matter the direction. A significant risk is the upcoming Supreme Court ruling on presidential tariff powers, which might spark considerable market volatility. We recall the market’s response to trade policy changes in 2018 and 2019, leading to sharp, unpredictable movements. Buying volatility through VIX calls or options on trade-sensitive ETFs could be a smart preparation for this event. In the crypto market, steady inflows into spot ETFs for assets like Solana and Ripple indicate strong institutional demand. This ongoing support suggests the bullish trend may continue, following last year’s momentum. We could use call options on these assets or related equities to capitalize on potential further gains while clearly managing our risk. Create your live VT Markets account and start trading now.

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