**Gold and Cryptocurrency Movements** Looking ahead to 2026, advanced economies are likely to perform well, thanks to various positive factors from 2025. Meanwhile, Avalanche is currently priced around $12 as Grayscale updates its ETF application, showcasing ongoing regulatory changes. The decline in net long oil positions indicates that speculators are losing confidence in a short-term price increase. We’ve seen similar trends during holiday seasons, like the volatility in late 2023 when institutional traders wrapped up their year. This suggests that using options to protect against WTI crude prices dropping below $80 per barrel might be a smart choice for early 2026. **Federal Reserves and Market Impacts** The US Dollar remains weak, and we believe markets are already accounting for expected rate cuts by the Federal Reserve in the first quarter of 2026. The CME FedWatch Tool indicates a nearly 90% chance of a rate cut by March, which is putting pressure on the dollar. This situation may favor short-dollar positions against currencies with more hawkish central banks. Gold’s recent pullback from its record high near $4,550 is typical profit-taking before the new year. The overall trend stays strong due to a weak dollar and ongoing geopolitical issues, which fueled a 20% rise in gold prices during 2025. Traders might consider buying put options for short-term protection and looking for dips to buy long futures positions for the expected rally in 2026. Strength in cryptocurrencies like Bitcoin and Ethereum hints that risk appetite is returning to the market. There has been an 8% rise in open interest for Bitcoin futures contracts in the last two weeks, indicating new investments are coming in before the new year. This bullish sentiment suggests that long-dated call options could be a good strategy to take advantage of potential gains in early 2026. In the last week of the year, we expect major currency pairs like EUR/USD and GBP/USD to stay within a certain range due to low trading volumes. Volatility is typically low during this time, with the VIX index remaining below 15 for most of December 2025. Writing short-term straddles or strangles may be an effective way to earn premium from the expected lack of significant price movements. Create your live VT Markets account and start trading now.

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