The State of Gold The GBP/USD is steady around 1.3500 as trading remains light. Many traders are cautious during this holiday season. Bitcoin dropped below $87,000 because of increased ETF outflows and less buying from large investors. US-listed spot ETFs saw an outflow of $188.64 million, which impacted Bitcoin’s price. Avalanche is holding around $12 after a small decline due to Grayscale’s attempt to convert its Avalanche Trust into an ETF. This filing has influenced market feelings and trading behavior. Looking ahead to 2026-2027, the economic outlook in advanced countries looks strong after a resilient year. There is optimism for significant growth in the near future. Strategies for Traders The sudden outflow of over ¥1.2 trillion from Japanese stocks is alarming. This is the fastest drop since early 2024. Traders might want to consider shorting Nikkei 225 futures or buying put options, as this negative trend is likely to continue into next year. Although gold has slightly fallen from its peak above $4,500, we see this as a brief pause due to holiday profit-taking. The Federal Reserve’s guidance from December 12, 2025, suggests three rate cuts for 2026, which should support the rise in precious metals. This dip could be a good chance to buy call options on both gold and silver futures in Q1 2026. Holiday trading has kept the S&P 500 steady, and market volatility is low with the VIX around 13.5. This low volatility makes options cheaper, allowing traders to position for growth anticipated in 2026. We are considering buying longer-term call options on major US indices to take advantage of this potential upside while managing risk. The difference in approaches between the dovish Federal Reserve and other central banks is opening up opportunities in the forex market. The Bank of Canada, for instance, indicated on December 5, 2025, that it would maintain a hawkish stance, leading the Canadian dollar to rise against the USD. We recommend shorting the US Dollar Index using futures or put options to capitalize on this policy divergence. Interest in Bitcoin is declining as ETF outflows speed up, with more than $850 million withdrawn just last week. The inability to break past the critical $90,000 resistance level indicates a bearish shift in momentum. We see a chance to buy put options on Bitcoin futures to hedge or speculate on a decline toward the $80,000 support level. Create your live VT Markets account and start trading now.

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