The CFTC S&P 500 net positions have fallen to $-132.9K from $-99.8K. This update was shared by the FXStreet Team on June 2, 2026, at 20:39:46 GMT. The EUR/USD pair has risen to a two-day high, approaching 1.1820, thanks to a weaker US Dollar. Factors like speculation about Federal Reserve interest rate cuts and improved US Consumer Sentiment are influencing these changes.

British Pound Increase

The GBP/USD has surpassed 1.3600, recovering from earlier losses due to the continued weakness of the US Dollar. Profit-taking and indications from the Bank of England have also strengthened the British Pound’s position. Gold prices have climbed above $4,900 per troy ounce and are aiming for the $5,000 mark. This trend indicates a shift toward safer investments amid changing risk perceptions. In the crypto market, Bitcoin is trading over $65,000 after a recent sell-off. Ethereum is above $1,900 but faces resistance at $2,000, while XRP has surged more than 10% to $1.35. A potential Japanese snap election may lead to fears about tax cuts and spending plans if the ruling coalition wins. Meanwhile, Ripple’s XRP continues to recover, gaining over 21% from its lowest point this week.

Market Positioning and Strategy

Current market trends indicate expectations of a Federal Reserve rate cut as soon as March. The immediate impact is a weakening US Dollar, making long positions on pairs like EUR/USD and GBP/USD appealing. Traders may want to buy call options for these currencies or sell put options on the Dollar Index (DXY) to take advantage of this trend. The case for a weak dollar solidified in late 2025, as inflation showed signs of cooling. For instance, the Core PCE Price Index, the Fed’s preferred measure, dropped to a 2.8% annual rate in December 2025, down from over 4% earlier that year. This downward trend provides the Fed with a reason to cut rates to support a slowing economy. In the equity markets, caution is crucial. The increase in net short positions on the S&P 500 among large speculators indicates that smart money is betting on a downturn or, at least, hedging against risk. Traders might consider buying put options on the SPY or VIX call options to profit from potential volatility increases. Historically, a similar situation occurred in late 2018 when the Fed shifted from raising to pausing rates, causing significant market turmoil before equities stabilized. With a government shutdown just resolved and important inflation and jobs reports ahead, we could see increased uncertainty. This historical context suggests that the initial market response to a Fed shift can be negative for stocks. Gold is gaining traction as a primary safe haven, with targets now aimed at the $5,000 level. The weaker dollar and ongoing uncertainty create strong support for gold’s rise. We should consider long-dated call options on gold futures or gold-backed ETFs to benefit from this upward trend. This momentum is backed by substantial institutional demand seen throughout 2025, when central banks bought a record 1,050 metric tons of gold. This relentless buying has created a solid price floor, enhancing the credibility of the current breakout. The demand reflects a global move to diversify away from the dollar, which is likely to keep supporting gold prices. Finally, the cryptocurrency market is showing signs of recovery after a massive liquidation event, which typically allows for a rebound. With Bitcoin back above $65,000, its high volatility makes it ideal for options strategies. We should consider straddles or strangles on BTC and ETH to take advantage of price movements, regardless of the direction. Create your live VT Markets account and start trading now.

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