The United States Core Personal Consumption Expenditures Price Index for November came in at 2.8%, matching expectations. This index tracks how prices change for goods and services that consumers buy, excluding food and energy. In the foreign exchange market, the USD/JPY pair is dropping because of a weaker US Dollar and attention on Japan’s CPI and BOJ decisions. On the other hand, EUR/USD is rising due to a declining US Dollar and strong data from the US.

Gold Market Dynamics

Gold prices are approaching all-time highs, topping $4,900, as risk appetite remains strong. Concerns over geopolitics and US economic data are driving the gold market. Bitcoin has seen slight growth, trading above $90,000 despite selling pressure from ETFs. Ethereum is steady at around $3,000, with the broader crypto market facing volatility due to a decrease in institutional interest. The political scene changed as President Trump rolled back NATO tariff increases that were suggested during the Greenland controversy. This has reduced geopolitical tensions and impacted global markets and risk assessments. Ripple continues to hold above $1.90, showing a positive short-term outlook amidst market volatility. This is happening despite cautious retail sentiment, as ETF investments keep flowing in.

November Core PCE Analysis

The November Core PCE data at 2.8% supports our view from late 2025 that inflation remains stubbornly high, well above the Federal Reserve’s target. This figure matches the persistent inflation seen throughout much of 2023 and 2024. It suggests the Fed has limited ability to ease policies, so we should maintain positions that benefit from a longer-term high interest rate environment, like long positions in interest rate swap futures. Despite this data, the US Dollar has weakened, indicating that the market is currently more focused on risk than on Fed policy. The recent easing of US-EU trade tensions over Greenland has increased risk appetite, pushing pairs like GBP/USD toward the 1.3500 mark. In the upcoming weeks, we can utilize call options on these currencies to capture momentum while minimizing downside risk if the dollar strengthens unexpectedly. Gold’s rise to nearly $4,900 an ounce, even amidst improving risk appetite, signals its separation from traditional market trends. This increase is driven by ongoing dollar weakness and record central bank purchases, according to the World Gold Council in 2025. Traders should consider collar strategies to safeguard profits on existing long positions, as gold is now entering price discovery territory. In the cryptocurrency market, Bitcoin is holding steady near $90,000, but the selling pressure from ETFs poses a challenge. We’ve seen similar institutional outflows lead to significant volatility after the introduction of spot ETFs back in early 2024. Given this uncertainty, buying straddles on Bitcoin, which benefit from major price movements in either direction, might be a smart approach to manage expected fluctuations. Create your live VT Markets account and start trading now.

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