Japan and Oil Prices

China’s house price index improved slightly to -2.2% in September, up from -2.5%. Additionally, in the third quarter of 2025, China’s economy grew by 4.8% compared to last year, matching expectations. Oil prices have stabilized, with WTI remaining around $57.00 amid concerns about oversupply from OPEC+. The Japanese yen has weakened due to renewed worries over fiscal issues as the LDP-JIP coalition returns. In the currency markets, the EUR/USD pair traded quietly near 1.1650 after France’s credit rating was downgraded. The GBP/USD remained above 1.3400, influenced by a weaker US dollar and dovish outlook from the Bank of England. Gold prices fell to around $4,245 as demand decreased after the festive period. Meanwhile, the crypto market saw gains for Mantle, Zcash, and Bittensor over the weekend. However, BNB, Solana, and Cardano faced double-digit losses due to significant sell-offs.

China House Prices and Economic Growth

Market participants are eagerly awaiting the upcoming meeting between Trump and Xi at the APEC summit, as it may lead to tension or negotiation. This adds complexity to the global financial landscape. The small rise in China’s house price index to -2.2% indicates that the property crisis, which began with the Evergrande collapse in the early 2020s, might be stabilizing. Still, with GDP growth at just 4.8% and the PBOC guiding the yuan lower, we should view this as a managed stabilization rather than a strong recovery. The Australian dollar’s strength appears temporary and could be a reason to consider selling call options if upcoming Chinese data disappoints. Europe presents a clearer, more negative outlook. France’s credit rating downgrade to A+ highlights ongoing fiscal weaknesses in a key Eurozone country. It may be wise to buy puts on the EUR/USD pair, as its struggle near 1.1650 reflects a lack of confidence likely to continue. Geopolitical tensions are causing a significant divergence in the commodities market that we can take advantage of. Gold is holding steady around $4,250, nearly double its price from early 2024, indicating high demand for safe-haven assets ahead of the Trump-Xi meeting. Conversely, WTI oil sits at $57, suggesting that market fears about a global slowdown outweigh worries about supply disruptions. The lower crude oil prices are linked to OPEC+ oversupply concerns, a familiar issue from 2024 when several members, including Iraq, repeatedly exceeded their production quotas, hurting price stability. Selling out-of-the-money call spreads on WTI futures could be a smart move since a price increase above $65 seems unlikely without a significant trigger. Lastly, the crypto market is reflecting a broad risk-off sentiment after more than $1 billion in liquidations. Major altcoins like Solana and Cardano declined over 10%, suggesting that speculative excess is being removed from the market. Given this, it’s wise to hedge any remaining long positions by buying puts on Bitcoin and Ethereum futures. Create your live VT Markets account and start trading now.

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