In September, the United States saw a construction spending increase of 0.5%, higher than the previous month’s 0.2%. This growth occurred alongside various economic activities and changes. By December, Australia is expected to have a higher unemployment rate. At the same time, the USD/JPY currency pair is stabilizing around 158.00, reflecting concerns about Japan’s fiscal situation affecting the yen.

The Dow Jones Industrial Average

The Dow Jones Industrial Average rose after President Trump announced no military actions would take place over Greenland. Meanwhile, the EUR/USD currency pair fell after a two-day increase, influenced by news related to Greenland. Gold saw a significant correction but kept its upward trend, peaking at $4,900 per troy ounce on Wednesday. In the world of AI tokens, performance varied, with some tokens finding support amid wider trends in the crypto market. Monero’s price continued to decrease, falling below $500, a drop of 38% from a previous high of $800. This decline is due to ongoing selling pressures. FXStreet notes that the information provided is for informational purposes only and recommends thorough research before making investment decisions. There are risks in trading, and it’s essential to consider potential losses.

Volatility Concerns

We witnessed significant volatility late last year regarding the Greenland issue. Although the immediate chaos after the Davos summit has eased, the situation is still a source of tension in the market. This uncertainty means traders should be careful about betting against volatility in major currency pairs. The strong construction spending from September 2025 was part of a broader trend that has continued into the end of the year. Recent reports show the unemployment rate has remained stable at 3.8%, but wage growth is speeding up more than expected. This is putting pressure on the Federal Reserve, with options on Fed Funds futures now suggesting a 60% chance of a rate hike by the end of the first quarter. This environment continues to strengthen the US Dollar, causing EUR/USD to drop from the 1.1700 level it had reached in 2025. The pair is now struggling to maintain the 1.1580 level, and if it breaks below this, we could see further declines. Traders might consider buying puts on the euro to prepare for this trend. Gold pulled back from its all-time high near $4,900 per ounce, reached during peak geopolitical risk last quarter. It is now hovering around the $4,750 level, and strategies like selling strangles may work well. Historically, gold tends to stabilize for several weeks after such a rapid increase, similar to what we saw in the third quarter of 2024. The Dow Jones Industrial Average has steadily climbed and is approaching the 42,000 mark as fears of direct conflict have diminished. However, with the CBOE Volatility Index (VIX) currently near a multi-month low of 14.5, buying VIX calls or out-of-the-money puts on major indices like the SPX can be a cost-effective way to protect against unexpected market moves. Create your live VT Markets account and start trading now.

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