In October, South Africa’s Producer Price Index rose from 2.3% to 2.9% year-on-year.
Early leak of UK budget suggests tax changes and cautious growth predictions, alleviating market concerns
The UK budget report was mistakenly published before the Chancellor’s speech, giving the markets a sneak peek at the details. The forecasts of slower growth and tax increases seemed more measured, easing some market worries; however, future spending plans still present fiscal challenges.
The budget report shows that the budget surplus for 2029/30 increased to GBP 22 billion, up from GBP 9.9 billion. Tax increases are projected to bring in an extra GBP 26 billion without significantly affecting inflation. Although growth forecasts have been adjusted, they remain hopeful yet more realistic.
Market Reactions
In response to the budget details, government bond yields fell, and the pound rose slightly after some fluctuations. Spending is expected to increase over the next two years, along with savings strategies planned for 2029/30 when fiscal rules take effect. There are some uncertainties regarding whether the proposed tax increases, aimed at balancing the budget, will be implemented, especially with elections coming up. The budget does not tackle the underlying issues and instead postpones them for later. After the budget leak on November 26th, the market initially reacted with relief. UK 10-year gilt yields dropped from about 4.1% to 3.95%, and the pound stabilized against the dollar, as the tax and spending plans were less aggressive than feared. This indicates that the immediate risk of a severe fiscal shock has eased for now. For derivative traders, this has led to lower near-term implied volatility in currency pairs like GBP/USD. One-month volatility has decreased to its lowest level since September, trading at about 6.5%. This situation may encourage strategies like selling short-dated strangles, provided no unexpected political events occur in December.Future Implications
However, the budget’s structure raises important long-term concerns. Major spending changes are postponed until the 2029/30 fiscal year, just before the next election cycle. This sets up a predictable point of potential fiscal strain that the market hasn’t fully accounted for. We’ve seen this pattern before, where difficult decisions are delayed, leading to greater market disruptions later, as witnessed with the reaction to the 2022 mini-budget. While the Office for Budget Responsibility now forecasts growth at a more realistic 1.2% for the upcoming year, their projections depend on future spending cuts that may be challenging to implement politically. This situation suggests considering longer-dated derivatives to address this uncertainty. Buying call or put options that expire in late 2027 or 2028 could be a wise way to hedge against or speculate on the inevitable fiscal challenges. The pound’s current stability might be fragile. It will be important to watch for updates from credit rating agencies like Moody’s and S&P for any changes in their outlook on the UK’s debt. Any shift could be a major trigger for reevaluating this long-term risk in the currency. Create your live VT Markets account and start trading now.Silver rises for the fourth consecutive day, approaching $54.00 due to a weak US dollar.
Silver has risen to over $54.00, close to last November’s high of $54.40. It has gained 7% in just four days this week, benefiting from a weaker US Dollar and lower US yields due to expected rate cuts from the Federal Reserve.
On Thursday, XAG/USD increased for the fourth straight day. US economic data exceeded expectations, with Durable Goods Orders climbing and jobless claims hitting a seven-month low. Still, futures markets suggest an 85% chance of a rate cut in December, which continues to pressure US Treasury yields and the Dollar.
From a technical standpoint, the outlook for Silver remains positive. The Relative Strength Index indicates overbought conditions, but the MACD remains positive, indicating strong upward momentum. Bulls aim for the November high of $54.40, with additional resistance at $55.00 and $56.60. Support is expected around $53.50 and further down at $52.75.
Silver is valued for its traditional role as a safe investment and a medium of exchange. Its price can be affected by geopolitical events, interest rates, the US Dollar, mining supply, recycling, and industrial demand. Silver is used in electronics and solar energy, and its price often follows Gold. The Gold/Silver ratio helps compare the value of the two metals.
Currently, the momentum is strongly bullish, and we expect further gains in the coming weeks. The market is factoring in an 85% chance of a Federal Reserve rate cut in December, which is driving this increase. Any short-term drops should be seen as buying opportunities rather than a trend reversal.
This outlook is reinforced by last week’s October 2025 CPI report, which showed core inflation at 2.7%, the lowest since mid-2023. This data supports the belief that the Fed can ease its policies, putting more downward pressure on US Treasury yields and the Dollar. As a result, non-yielding assets like silver become much more appealing to hold.
We are using call options to take advantage of this upward trend, aiming to reach the resistance levels of $54.40 and then $55.00 soon. After a 7% surge this week, buying on a pullback towards the $53.50 support level offers a favorable risk-reward entry point. The Relative Strength Index is overbought, so a brief consolidation before moving higher would be a healthy sign.
The fundamentals also appear strong. A recent Silver Institute report cited a 15% year-over-year increase in industrial demand from the solar sector through Q3 2025. Additionally, the gold-silver ratio has dropped below 70:1, down from over 85:1 earlier this year, indicating that silver is gaining strength against gold. This dual support from industrial and investment demand boosts our confidence in a bullish outlook.
Cold spells reduce European gas storage to below 78%, raising winter market risks.
European gas storage has dropped below 78% due to colder-than-usual weather. While forecasts suggest milder conditions in early December, storage levels remain below the seasonal average.
Speculators have switched to a net short position of 11.4 TWh, down from a net long of 15.6 TWh. This is the first net short position since March 2024, with new shorts hitting a record high.
This change poses risks if there are sudden shifts in supply or demand during winter.
These insights come from various commercial and analytical sources, highlighting market trends and conditions.
Currently, European gas storage levels are at 77.8%, down from 95% last year and well below the 88% comfort level of last year. This drop is driven by colder weather across Europe, which has increased heating demand.
Despite the tightening supply, speculators are increasingly bearish. They have taken a net short position for the first time since March 2024. Recent reports show a record level of short positions, indicating that many expect early December’s milder weather forecast to lower prices. This expectation has kept front-month TTF prices close to €55/MWh.
This large short position could lead to a short squeeze soon. Any unexpected positive news, like a supply issue at an LNG facility or a longer cold spell, might force these speculators to rapidly cover their shorts. Even a small event could spark a significant price increase.
Given these risks, maintaining large short positions is very risky. Instead, traders should think about buying out-of-the-money call options for January and February. These options are relatively inexpensive but have great potential for profit if prices spike, offering a low-risk way to take advantage of current market pressures.
Canadian dollar strengthens from oil recovery as EUR/CAD falls to around 1.6260
EUR/CAD is weakening as the Canadian Dollar gains strength from rising oil prices. Canada’s position as the largest crude exporter to the US plays a key role in this shift. If a ceasefire occurs between Ukraine and Russia, it might affect oil prices, potentially leading to reduced sanctions on Russian oil.
Currently, EUR/CAD is trading around 1.6260, continuing its downward trend for the second session. Meanwhile, West Texas Intermediate (WTI) is priced at about $58.60 per barrel. However, trading volume is low due to the US Thanksgiving holiday. US envoy Steve Witkoff is set to discuss ending the Ukraine conflict in Moscow.
European Central Bank’s Cautious Policy
The Euro finds some support due to the European Central Bank’s (ECB) careful approach. The ECB is expected to keep interest rates steady through next year. Officials suggest rate cuts only if inflation falls below the target without signs of recovery. ECB data emphasizes the need to maintain price growth close to the 2% target. Today, the Euro has performed the weakest against the New Zealand Dollar while showing mixed performance against other currencies. Key ECB figures, including Vice President De Guindos and Chief Economist Philip Lane, support a cautious stance. Croatia’s central bank governor advises careful evaluation before making any rate cuts, considering possible inflation shifts. The EUR/CAD pair is testing the 1.6250 level as the Canadian dollar strengthens with rising oil prices. West Texas Intermediate crude is around $58.60, down from its earlier highs of $80-90 during 2023-2024, yet still recovering. This short-term trend favors those betting against the Euro, especially since Canadian oil production has reached a record of 4.9 million barrels per day.Monitoring Ukraine Russia Talks
We need to closely observe the ongoing situation between Russia and Ukraine. The upcoming talks in Moscow could lead to eased sanctions, potentially boosting global oil supply and lowering prices. A significant drop in oil could weaken the Canadian dollar and cause the EUR/CAD pair to rise sharply. Conversely, the Euro has a solid base due to the ECB’s firm stance on interest rates. With Eurozone inflation stubbornly holding at 2.4%, the ECB is unlikely to consider rate cuts until 2026. This marks a significant change from the rapid rate hikes of 2022 and 2023. Given these conflicting influences, traders might explore strategies that profit from a defined trading range or gradual downward trends. The pair has risen significantly from the 1.48 range in early 2024, but the ECB’s policies provide strong support against a total fall. Thus, selling out-of-the-money call options or establishing bearish put spreads could help manage risk while anticipating a drop toward the 1.6000 mark. The uncertainty around the ceasefire talks is likely keeping implied volatility high for this pair. This situation presents a valuable opportunity for traders looking to sell premium, believing that the pair will stay within well-defined support and resistance levels in the upcoming weeks. We can look for chances to sell strangles, collecting premium while waiting for a clearer trend to emerge. Create your live VT Markets account and start trading now.Société Générale analysts see USD/JPY facing resistance at 157.90, indicating a potential pullback to 154.40–152.80.
**USD/JPY Resistance at 157.90**
USD/JPY is facing resistance around 157.90. While we might see a short rebound, if this level isn’t broken, it could lead to a drop to about 154.40–152.80.
The currency pair recently created a lower high near 157.90, compared to the previous peak of 158.85 in January. This is happening as it moves towards a steep upward trend line. If it cannot break the 157.90 level, the pullback may continue.
If the decline goes on, the high of 154.40 from last month and the recent low of 152.80 may act as support.
We are seeing a strong resistance for USD/JPY near 157.90. The pair is struggling to rise above this mark, indicating that its recent upward trend is slowing down. Failure to go higher could lead to a more significant pullback in the coming weeks.
**US Economic Data Impact**
This resistance level is supported by recent US economic data. The October 2025 inflation report showed core CPI falling to 2.9%, which is slightly below expectations and shows a cooling trend. As a result, the US 10-year Treasury yield has dropped to about 4.25%, reducing the rate gap that has typically favored the dollar.
Additionally, the Bank of Japan has been using more decisive language about future policy changes. Many now believe that moving away from negative interest rates might happen in the first half of 2026. This shift has strengthened the yen and caused traders to be cautious about pushing the dollar much higher.
For those trading derivatives, buying put options with strike prices around 156.00 or 155.50 could be a wise choice. This allows traders to profit if the price falls towards the 154.40–152.80 support zone. The limited risk of options contracts is particularly useful given the chance of a sudden price change.
It’s important to remember the swift interventions by Japanese authorities when the pair hit similar highs in 2022 and 2024. The market recalls how quickly the Ministry of Finance can act, creating a mental barrier around the 160 level. This history suggests increased risks to the downside from these high levels.
**Volatility Strategies for Traders**
Traders might also look into strategies that benefit from rising volatility, as the pair is poised for potential large movements. A long straddle, which involves buying both a call and a put option, could profit from a breakout in either direction. This prepares for either a surprising rise above resistance or the more expected sharp pullback.
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USD/JPY declines to 156.30 following changes in BOJ rhetoric, analysts note
USD/JPY has dropped recently due to changes in the Bank of Japan’s (BOJ) position. This follows a meeting between Takaichi and Ueda last week. Currently, the currency pair sits at 156.30, according to analysts Frances Cheung and Christopher Wong from OCBC.
Hawkish Turn of BOJ
The BOJ has taken a more aggressive tone, suggesting possible interest rate hikes. Ueda mentioned in parliament that the BOJ will discuss the timing and feasibility of these hikes in future meetings. Factors like rising wages, increasing services inflation, and positive economic activity support this new approach. Analysts now estimate a greater than 50% chance of a rate hike in December, up from just 16% the previous week. Technical indicators suggest that the slight upward momentum is fading, with the RSI decreasing. There could be a corrective pullback, with support levels seen at 155.05, 154.40, and 151.60. Resistance is at 157.90 and 158.87, marking previous highs. This analysis comes from the FXStreet Insights Team, which includes insights from commercial notes and expert analysts. USD/JPY has eased from its highs and is currently trading around 156.30 as the BOJ adopts a tougher stance. This shift appears to have started after last week’s meeting among key officials. The market now sees a better than 50% chance of a BOJ rate hike in December, a big increase from 16% just a week ago. Strong domestic data supports this shift. Recent reports show that nominal cash earnings in Japan rose 2.5% year-over-year, the fastest growth in years, while the latest Tokyo Core CPI reached 2.8%. These figures give the BOJ a reason to start normalizing its policy after a long pause.Impact on the US Dollar
On the flip side, the US dollar faces challenges. The latest US PCE inflation data for October 2025 came in at a lower-than-expected 2.9%, raising speculation that the Federal Reserve may be finished with its tightening cycle. This difference in policy, with the BOJ becoming more hawkish while the Fed remains neutral, adds downward pressure on the currency pair. Given the potential for a pullback, derivative traders should consider strategies that profit from a falling USD/JPY. Buying put options can effectively capture downward movement while limiting risk to the premium paid. This strategy aligns with the declining bullish momentum visible in the daily charts. The expected policy change is likely to increase price fluctuations, making volatility a tradable opportunity. Implied volatility for USD/JPY options is rising as the December BOJ meeting approaches. Traders might consider long volatility strategies, such as straddles, to take advantage of significant price movements in either direction, which are typical during major policy shifts. It’s important to monitor key technical levels for risk management. The support at the 21-day moving average of 155.05 is the first major test for the pair’s decline. A break below this level could lead to further drops towards 154.40 and possibly even 151.60, levels not seen since the sharp rise earlier in 2025. Create your live VT Markets account and start trading now.EUR/JPY trades around 181.00 after recent losses amid rising speculation of Japanese intervention
EUR/JPY is under pressure as the Japanese Yen strengthens due to speculations of possible intervention. The Yen is gaining strength as expectations grow that the Bank of Japan (BoJ) may raise interest rates next month. Meanwhile, the Euro is stabilizing because of the European Central Bank’s cautious approach. Currently, the currency pair is trading around 181.00. With US markets closed for Thanksgiving, there might be a chance for Japanese action.
**Speculation Regarding BoJ’s Policy Shift**
Speculations about a shift in BoJ’s policy come amid worries about inflation and a weakening Yen. The potential for intervention has already stopped further declines in the Yen. Traders think the BoJ may move away from its very loose monetary policy due to rising inflation and political factors. Even though the Yen is gaining strength, the Euro remains stable thanks to the ECB’s consistent policy outlook.
ECB officials are cautiously optimistic about growth and interest rates, with no big policy changes expected in the near term. Important data, such as consumer and business confidence surveys and inflation expectations, are eagerly awaited. The BoJ’s previous expansive monetary policies have affected the Yen, and the anticipated policy shift is influencing currency movements in the markets.
There is strong pressure on EUR/JPY around the 181.00 mark, created by the Yen’s strength. This situation, combining possible Japanese intervention with a stable European Central Bank, could lead to significant volatility. Traders should brace for sharp price movements in the upcoming weeks.
The talk of intervention is not unfounded, recalling the massive actions taken in 2022 and 2024 to support the Yen. With Japan’s core inflation at about 2.8%, above the BoJ’s target, a rate hike in December seems more likely. This marks a significant change from the negative interest rates that ended in March of last year.
**Volatility and Profit Strategies**
Given the increasing risks, buying EUR/JPY put options seems wise. This can help hedge long positions or bet on further Yen strength. Historically, low liquidity during the US Thanksgiving holiday raises the chances of sharp price swings, making long volatility strategies like straddles potentially rewarding. Implied volatility for Yen pairs is likely to increase, so acting quickly may be beneficial.
However, the Euro’s stability may limit the potential for a sharp drop. The European Central Bank is keeping its deposit rate steady at 3.5%, while Eurozone inflation hovers around 2.4%, indicating no desire for rate cuts. This significant interest rate gap continues to give support to the Euro against the Yen.
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Markets see reduced activity and lower trading volumes due to the Thanksgiving holiday.
On Thursday, trading volumes in financial markets were low because of the Thanksgiving Day holiday in the United States. In Europe, key economic data on business and consumer sentiment was released, and the European Central Bank shared minutes from its October meeting.
This week, the US Dollar weakened against several major currencies, showing a notable drop of 1.80% against the New Zealand Dollar. The US Department of Labor reported a decline in Initial Jobless Claims to 216,000 for the week ending November 22. Additionally, Durable Goods Orders rose by 0.5%, supporting a positive market outlook.
UK Economic Updates
In the UK, Finance Minister Rachel Reeves announced tax increases on savings, dividends, and property income, along with an extended income tax freeze. This led the GBP/USD to reach a month-high of 1.3270 before settling. The EUR/USD neared 1.1610, while the USD/JPY saw some midweek gains but began to drop early Thursday. Gold prices stayed above $4,150, driven by expectations of a possible rate cut from the Federal Reserve in December. Market sentiment continues to sway currency and commodity performance, displaying clear “risk-on” and “risk-off” trends. The market feels quiet due to the Thanksgiving holiday in the US, but this does not indicate a lack of direction. As liquidity returns next week, we expect the current risk-on sentiment to pick up speed. We are bracing for further weakness in the US Dollar in the coming weeks. This outlook largely stems from the increasing likelihood of a Federal Reserve rate cut in December. Recent mid-November data revealed cooling inflation trends, with the Consumer Price Index (CPI) dropping to 2.9%. The CME FedWatch Tool indicates an 85% chance of a rate cut in the next meeting, making a dovish Fed shift our main scenario.Currency And Market Predictions
This environment favors currencies like the New Zealand and Australian Dollars, which have performed well against the US Dollar. We see opportunities to buy calls or take long positions on these currencies against the greenback. The S&P 500 has already risen over 6% this month, and we expect this trend to continue, supporting long positions in equity index futures. The British Pound received a short-term boost from the Autumn Budget, but this momentum may not last. The Euro’s potential for growth might also be limited, as the recent ECB minutes from October 2025 indicate hesitation to tighten policy because of slow growth. Thus, we prefer commodity currencies over European currencies to benefit from dollar weakness. Gold trading above $4,150 signals the market’s expectation for lower interest rates. As the costs of holding non-yielding assets decrease, gold becomes more appealing. We predict further gains for the precious metal, making long positions in gold derivatives a key strategy as we approach year-end. Create your live VT Markets account and start trading now.MongoDB shares fell by 1.65% to $326.27, despite a rising market and the S&P 500’s gains.
MongoDB (MDB) stock recently dropped 1.65% to $326.27, while the S&P 500 rose by 0.69%. The Dow and Nasdaq also increased by 0.67% and 0.82%, respectively. Over the past month, MongoDB’s stock has fallen 1.4%, lagging behind the Computer and Technology sector, which gained 0.07%, and the S&P 500, down 0.31%.
MongoDB’s earnings report is expected on December 1, 2025. Analysts predict earnings per share (EPS) will be $0.79, a decline of 31.9% from last year. Revenue is projected to rise by 11.68% to $591.22 million. For the year, estimates suggest earnings of $3.7 per share and revenue of $2.35 billion, marking increases of +1.09% and +17.31%, respectively, compared to last year.
Changes in analyst estimates can influence MongoDB’s stock performance. The Zacks Rank model indicates that stocks rated #1 have averaged a +25% annual return since 1988. The Consensus EPS estimate has increased by 0.55% over the past month, and MongoDB currently holds a Zacks Rank of #2 (Buy).
MongoDB’s Forward P/E ratio is 89.58, well above the industry average of 28.61, with a PEG ratio of 5.72 compared to the industry average of 1.86. The Internet – Software industry ranks in the top 29% of over 250 industries according to Zacks.
With MongoDB’s earnings call on December 1, 2025, just days away, the stock is poised for significant volatility. It is currently underperforming in a rising market, with mixed expectations—revenue is expected to grow, but earnings per share are forecasted to fall sharply by 31.9%. This mix of growth and earnings decline often leads to big price swings post-announcement.
The options market indicates this uncertainty, with high implied volatility for weekly options expiring after the earnings announcement. Current prices reflect the market’s anticipation of a potential 15% price move in either direction. Historically, MongoDB has experienced similar large gaps, including a 20% drop following its earnings report in March 2024, highlighting its sensitivity to guidance.
Traders who expect a disappointing report should be cautious of the stock’s high valuation. A forward P/E ratio near 90 presents a significant risk, especially since the Federal Reserve is likely to keep interest rates steady around 4.5% into next year, impacting growth stock valuations. Any revenue miss or weak guidance could lead to a sharp sell-off, making long put positions or bear put spreads appealing strategies.
Conversely, there are optimistic signs that could lead to an upside. Recent analyst upgrades suggest potential for a positive surprise. If MongoDB beats lowered expectations and provides strong guidance for 2026, it may trigger a short squeeze, benefiting those holding long call options or bull call spreads.
Given the event’s binary nature and high implied volatility, strategies that profit from large price movements, regardless of direction, are also worth considering. A long straddle or strangle could capitalize on significant price swings exceeding the option premiums. However, the high premiums mean the stock must move considerably to make these strategies profitable.
Finally, we should note the broader context from the last earnings season. In the third quarter of 2025, other high-growth software companies, like Snowflake, faced sharp declines due to minor growth outlook decelerations. This indicates that the market is expecting perfection, making MongoDB’s forward guidance the key data point to monitor next week.
