Commerzbank analysts expect concerns about copper supply to persist.
Copper supply issues are expected to continue as prices stay close to recent highs, according to Commerzbank. Data from China reveals ongoing weak demand in manufacturing and construction, but industrial output remains strong and is on the rise.
A recent 10 percent cut in US tariffs on Chinese goods wasn’t included in the latest survey. Furthermore, Chile’s copper mine output fell in September, and overall metal production fell short of expectations, according to a Reuters survey.
These factors indicate that supply concerns will persist, limiting how much copper prices can drop in the short term. Recovery from copper’s record high seem hindered by ongoing supply chain problems.
We view the recent drop in copper prices from above $11,000 per tonne as a short break, not the beginning of a major decline. Supply concerns are too significant and will likely continue in the upcoming weeks. This creates a price floor, which restricts the potential for further declines.
The supply situation is tight, with Chile’s state-owned Codelco reporting an 8% year-over-year drop in its output for the third quarter, following a trend we have observed this year. These production shortages are not unique; we are also watching potential disruptions from labor talks in Peru and energy limitations in Zambia’s copper belt. These challenges strengthen the view that the market has little room for further disruptions.
On the demand side, we aren’t overly worried about China’s recent PMI figures, which show a slight contraction in manufacturing. We have seen similar patterns in 2024 and 2025, where official PMI data doesn’t fully reflect the strength in certain sectors, such as electric vehicles and renewable energy infrastructure. The recent 10% cut in US tariffs on some Chinese goods should also slightly boost industrial demand leading into 2026.
For derivative traders, this suggests that selling out-of-the-money puts may be a good strategy to earn premium, as ongoing supply issues create a strong support level. Buying call spreads on dips could allow for gains during potential price surges while managing risk. We believe that taking aggressive short positions is particularly risky until there’s clear evidence of a major increase in supply or a significant drop in actual demand.
Increased investor interest caused gold to reach unprecedented demand, despite a temporary price decline.
Gold demand hit record highs in the third quarter, mainly due to significant ETF inflows of 222 tons and over 300 tons in purchases of bars and coins. Although there was a temporary price drop of USD 500 from its peak in October, gold is still seen as a safe haven. The World Gold Council indicates strong demand fueled by favorable investment conditions.
Central banks and institutions bought 220 tons of gold in the third quarter, an increase of 28% from the previous quarter and 10% from last year. About two-thirds of these purchases were not reported. For 2023, central bank gold acquisitions are expected to be between 750 and 900 tons, a decrease compared to recent years but still higher than pre-2022 levels.
Jewellery Demand Decline
High gold prices continue to lower jewellery demand, which has fallen for the sixth straight quarter. China shows some resilience, while India’s jewellery demand dropped by 31% from last year, falling to 118 tons—the lowest for a third quarter since 2020. The steep price drop from the record high on October 20, 2025, has caused significant short-term market fluctuations. While this just erased previous month’s gains, it shows that the rise is not straightforward. We view this as a healthy pause before the next significant move, creating opportunities for those ready to trade. Investor interest is maintaining price stability, with ETF inflows reaching a record 222 tons in the third quarter. Recent data shows that SPDR Gold Shares (GLD) had its largest net inflow since the banking issues in spring 2024. This suggests that long-term investors are taking advantage of any price drops to buy.Central Bank Purchases
It’s essential to note the consistent buying from central banks, which added 220 tons in the third quarter. The fact that many of these purchases are unreported indicates a strategic move towards gold, likely due to geopolitical risks. This institutional demand helps prevent a significant price decline. The main challenge remains monetary policy, as comments after the last Federal Reserve meeting have raised doubts about a much-anticipated interest rate cut in December. With core inflation data for September slightly above expectations at 3.8%, the market now believes there’s a higher chance that rates will remain high. This uncertainty may limit any immediate sharp rally in gold prices. The interplay of strong demand and Fed-related uncertainty means gold options may see high implied volatility. Traders might consider strategies that benefit from significant price movements in either direction, such as long strangles, especially around key economic data releases in November. For those optimistic about gold, using bull call spreads on December or January contracts can help capture potential gains while clearly defining risks. Create your live VT Markets account and start trading now.Carsten Fritsch from Commerzbank says Russia effectively secures buyers for its crude oil
Russia’s crude oil exports remain strong, as noted by Commerzbank’s commodity analyst. Bloomberg data indicates that last week, Russia’s seaborne oil exports reached 3.56 million barrels per day, only slightly down from the previous week. The four-week average has dropped to 3.72 million barrels per day, following its recent peak in May 2023.
Shipments to China and India have decreased recently. For the past three weeks, deliveries to India have fallen below 1 million barrels per day, and China has cut back its purchases in the last two weeks. However, these numbers might underestimate actual shipments, especially for India last week, which could mean revisions upward. It seems too early to say that recent US sanctions against major Russian oil firms are the cause of this decline.
Impact of US Sanctions
Despite the drop in shipments, overall export figures from Russia indicate that US sanctions have not yet significantly affected oil exports. The FXStreet Insights Team provides a wider market view, using data from commercial and external analysts. With the steady flow of Russian oil, crude prices are likely to remain capped for now. High export volumes, with the recent four-week average at its highest since May 2023, show that the market is adequately supplied. This limits the potential for price increases in futures contracts like Brent and WTI. Nevertheless, the decrease in deliveries to India and China introduces uncertainty, creating a suitable environment for volatility trading. The CBOE Crude Oil Volatility Index (OVX) has risen to 42 recently, indicating trader concerns about whether this is just a data lag or an early sign of sanctions having an effect. Options like straddles could be useful for profiting from possible sharp price movements in either direction in the coming weeks. In the short term, a bearish strategy seems wise while we await more clarity on Asian demand. With Brent crude around $87 per barrel, selling out-of-the-money call options with a strike price above $95 could be a smart move to collect premiums. This strategy thrives if prices remain stable or fall as Russian oil continues to be sold.Market Reactions and Strategies
Looking ahead, it’s important to recall the market’s reaction in spring 2022 when supply concerns pushed Brent crude over $120 per barrel. If US sanctions significantly disrupt the 3.7 million barrels per day from Russia, we could see another price spike. Therefore, holding long-dated call options for the first quarter of 2026 could provide a safeguard against sudden supply shocks. This situation also opens up opportunities for spread trading, especially between Brent and Urals crude. This spread has recently narrowed to under $15, but if sanctions tighten and fewer buyers are willing to engage with Russian oil, we expect that discount to widen considerably. With global refinery utilization rates already tight at 92%, any disruption in Russian crude flow could greatly affect product prices. Create your live VT Markets account and start trading now.Commerzbank’s Carsten Fritsch reports a 6.9 million barrel drop in US crude oil stocks.
The US Department of Energy reported that crude oil inventories fell by 6.9 million barrels last week. Gasoline stocks dropped by 5.9 million barrels, while distillate stocks decreased by 3.4 million barrels.
This drop in crude oil inventories happened because net imports significantly declined, which was a bigger factor than the weaker crude oil processing. This change also caused gasoline and distillate stocks to decrease, driven by higher demand for gasoline.
Inventory Levels and Market Impact
Crude oil and distillate inventories are now much lower than their five-year averages. Gasoline inventories are also below normal for this time of year, but the difference is small. Similar reports from the API had already pointed to notable declines, so the release of this information had only a slight effect on oil prices.
The recent sharp drop in US crude, gasoline, and distillate inventories suggests a tighter market. With crude stocks well below their five-year average, the supply cushion is thin. This is particularly the case for distillates, which are also considerably below seasonal averages as we head into winter heating season.
Given these significant inventory declines, there is a clear case for bullish energy derivatives in the upcoming weeks. The decrease in heating oil stocks is especially noteworthy as we start November, indicating that prices could become very sensitive to cold weather forecasts. Traders may want to consider strategies that profit from rising prices, such as buying call options on WTI futures.
This tight market is occurring while the Strategic Petroleum Reserve is around 345 million barrels, a level not consistently seen since the early 1980s. This situation removes a key safety buffer. We experienced similar concerns about tight distillate supply before winter in 2022, which resulted in significant price volatility. Current conditions suggest we might see similar sensitivities again.
Market Strategy and Demand
On the demand side, recent data shows that US GDP growth for Q3 2025 was robust at 2.4%. This suggests that consumer and industrial energy needs will likely remain strong. This demand is meeting constrained supply, as reports indicate that OPEC+ has continued its production cuts with high compliance through September 2025. These factors help support price stability.
Even though the market’s immediate reaction was mild since the draws were expected, the underlying physical tightness is now confirmed. This makes the market very vulnerable to any unexpected supply disruptions or sudden increases in demand. Therefore, preparing for increased volatility, possibly through long straddles, could be a wise strategy.
Create your live VT Markets account and start trading now.USD/CNH approaches 7.1200 as analysts note China’s weak October PMI and the strength of the US Dollar
The USD/CNH exchange rate is nearing 7.1200 because the US Dollar is gaining strength. This increase follows China’s October PMI announcement, which indicates a slowdown, according to currency experts.
China’s official headline PMI has dropped by 0.6 points to 50.0, the lowest level since December 2022. The manufacturing PMI fell more than expected, from 49.8 to 49.0, while analysts had predicted a decline to 49.6. This change is linked to a shorter holiday in October and difficulties in global trade. On a brighter note, the non-manufacturing PMI met expectations, holding steady at 50.1 compared to 50.0 in September.
Shift in China’s Economic Strategy
Although the trade truce between the US and China might benefit China’s manufacturing sector, it is crucial to tackle domestic economic issues. China needs to focus on domestic consumption for long-term growth. A gradual increase in the value of China’s currency could help boost consumer spending by making imports cheaper, increasing disposable income. The current trend for the USD/CNH is downwards. As of now, the recent weakness in China’s October PMI significantly contributes to the rise in USD/CNH. The manufacturing figure dropping to 49.0 is especially troubling, indicating contraction and showing the ongoing difficulties in global trade. This weak data explains the pair’s testing of the 7.1200 level. This situation offers a short-term opportunity, particularly given the stronger US economy. The recent flash estimate of the US Q3 GDP at 2.9% shows the resilience of the US, which should support the Dollar in the short term. Traders might focus on strategies that benefit from further increases, potentially targeting the 7.1500 resistance level in the next week or two.Long-Term Downtrend Remains Strong
However, we believe the long-term downtrend in USD/CNH remains the primary trend. China’s need to enhance domestic consumption suggests that a stronger currency is necessary over time. Thus, any price increases driven by short-term weak data should be viewed as opportunities to sell. For derivative traders, a patient approach is recommended. Waiting for the pair to rise before taking bearish positions is wise. Purchasing put options as prices approach the 7.1500-7.2000 range could be a smart tactic to prepare for the anticipated return of the downtrend. This strategy allows traders to benefit from the expected shift while taking advantage of the current upward momentum. We recall similar situations from 2023 when worries about China’s growth led to temporary spikes in USD/CNH above 7.30. Those spikes eventually subsided as policy support was implemented and the longer-term currency revaluation narrative reemerged. This historical trend suggests that selling into strength is preferable to chasing the current rally. In the upcoming weeks, we will closely monitor China’s Caixin PMI data for November to confirm this slowdown. Additionally, the next US inflation report and any forward guidance from the People’s Bank of China will be vital factors. These events will likely determine whether the current spike will continue or if the downtrend will reassert itself. Create your live VT Markets account and start trading now.UOB Group analysts expect the USD/CNH to fluctuate between 7.0920 and 7.1280.
The US Dollar is expected to stay within the range of 7.1000 to 7.1180. Long-term predictions indicate that the dollar’s earlier weakness has stabilized. Analysts from UOB Group forecast it will trade between 7.0920 and 7.1280.
In the last 24 hours, the USD surged, hitting a peak of 7.1178, which went beyond expectations of it trading in the 7.0900 to 7.1080 range. This sharp rise seems excessive, and further increases are not anticipated. Instead, the dollar is more likely to consolidate within the tighter range of 7.1000 to 7.1180.
USD Currency Path
Recent analysis suggests that the USD might fall below 7.0860, unless it breaks above 7.1150, which is a critical resistance level. The unexpected rise past this level indicates that its weakness has leveled off. Moving forward, it is anticipated to range between 7.0920 and 7.1280. The FXStreet Insights Team shares selected market observations from experts, offering insights from both internal and external analysts. The recent spike in USD/CNH above the 7.1150 resistance has shifted our outlook. The dollar’s weakness seems to have stabilized, leading us to expect a range-bound trading environment. Derivatives traders should prepare for movement between 7.0920 and 7.1280 in the upcoming weeks. With this expected range, strategies that profit during low volatility, like selling an iron condor, may work well. Traders might consider selling call options with a strike price above 7.1300 and put options below 7.0900. This strategy capitalizes on time decay as long as the pair stays within this channel.Economic Data and Market Impact
This outlook is backed by recent economic data. This week’s US Core CPI figure of 3.1% was slightly above expectations. This supports the Federal Reserve’s neutral stance, which limits any strong moves for the dollar. Meanwhile, China’s official manufacturing PMI remained steady at 50.1, indicating stability but not enough growth to strengthen the yuan significantly. Implied volatility for one-month USD/CNH options has decreased to multi-month lows, now around 4.2%. This low volatility makes selling premium appealing for traders who believe a consolidation period is likely. This marks a significant change from the market conditions in 2023-2024, when the pair frequently tested levels above 7.30 amidst higher uncertainty. Create your live VT Markets account and start trading now.India’s M3 money supply decreased to 9.2%, down from 9.6%
India’s M3 money supply dropped from 9.6% to 9.2% in October. This is a decline compared to earlier figures.
Gold prices remain steady above $4,000. However, a strong US dollar is limiting its potential for growth. Meanwhile, the Canadian dollar has weakened as demand for the US dollar increases, following a cautious statement from the Federal Reserve.
Silver And Nasdaq Performance
Silver is holding close to $49 due to uncertainty in US finances and a trade truce. The Nasdaq 100 index has pulled back but is on track for an 11% rally that could set new records. The British pound has a weak tone, and the Euro is staying within a narrow range, supported in the low/mid 1.15s. The EUR/USD has dropped to two-month lows around 1.1520, while GBP/USD has fallen below 1.3100, reaching six-month lows. Gold prices have turned negative around $4,000. In the cryptocurrency market, Bitcoin, Ethereum, and XRP are facing instability as demand looks shaky. As Bitcoin celebrates the 17th anniversary of its whitepaper, it has evolved from a cypherpunk idea to a significant global financial asset. The US dollar shows broad strength, pushing EUR/USD to two-month lows near 1.1520 and GBP/USD to a new six-month low below 1.3100. This trend is driven by a cautious tone from the US Federal Reserve, especially since core PCE inflation data from September 2025 came in at a persistent 3.1%. Traders might want to consider strategies that leverage this dollar strength against major currencies.AI Driving US Tech Stocks
Despite the uncertainty in the wider market, the AI trend remains a key factor boosting US tech stocks. The recent pullback in the Nasdaq 100 is seen as a buying chance, especially after strong Q3 2025 earnings from leading companies confirmed significant revenue growth related to AI. Investors might consider buying call spreads on tech-heavy indices to capitalize on a potential rally beyond recent highs. Gold is trading flat above the important $4,000 level, but the strong dollar is currently limiting its rise. This price reflects the significant inflation pressures seen in 2024, but the environment is creating a tight trading range. With potential US fiscal uncertainty approaching December’s budget deadlines, options straddles on gold futures could be a strategy to hedge against any resulting volatility. We’re also noticing a more cautious approach to risk in other areas. The decline in India’s M3 money supply growth to 9.2% suggests that the central bank is intentionally cooling the economy to manage inflation. Together with wavering demand for cryptocurrencies like Bitcoin, this may call for hedging long positions in emerging markets or other speculative assets. Create your live VT Markets account and start trading now.Analysts report that USD/JPY stabilizes under 155 amid Yen weakness after recent gains
The USD/JPY is currently stabilizing below the 155.00 level after some recent gains. Analysts from BBH say this is an important resistance point.
Japan’s Finance Minister, Satsuki Katayama, has stressed the government’s close watch on the yen’s rapid changes. He pointed out recent one-sided movements in the currency and made it clear that the government is ready to monitor foreign exchange markets for any excessive or disorderly changes.
Limited Opportunities to Stabilize the Yen
Despite these concerns, opportunities to stabilize the yen are limited unless the Bank of Japan (BOJ) takes a stronger approach. The BOJ’s current neutral stance is not enough to stop the yen’s decline and may only slow its drop temporarily. The FXStreet Insights Team gathers observations from market experts, combining insights from commercial sources with both internal and external analysts. The USD/JPY pair is approaching the key 155.00 resistance level. This pressure stems from the wide gap in interest rates between the US Federal Reserve’s 4.5% and the BOJ’s 0.25%. This difference makes holding dollars much more appealing than yen. Tokyo officials are voicing concerns about the yen’s rapid decline. However, these warnings may not have much impact without a stronger policy shift from the BOJ. The central bank’s recent decision to maintain its current stance indicates it is not ready to provide significant support for the currency.Strategy for Derivatives Traders
For derivatives traders, this situation is favorable for buying USD/JPY call options with strike prices above 155.00. This strategy allows traders to benefit from an expected upward trend due to policy differences. The defined risk, limited to the premium paid, provides protection against a sudden drop caused by official intervention. We should remember the market interventions that occurred in autumn 2022 and spring 2024 when the pair crossed similar key levels. This history indicates that while the trend is upward, there is a real risk of a sharp drop if the pair hits these high points. Therefore, a strategy with limited downside is wise. The dollar’s upward trend is also supported by recent data, with last month’s US Non-Farm Payrolls showing a strong addition of 210,000 new jobs. In contrast, Japan’s latest core inflation rate of 2.7% is not high enough to prompt the BOJ to act aggressively. This ongoing divergence is likely to keep weakening the yen as we move into the new year. Create your live VT Markets account and start trading now.UOB Group analysts predict USD/JPY could hit 154.50 before a pullback to 154.90.
Current Analysis and Market Behavior
The US Dollar (USD) may reach the 154.50 mark against the Japanese Yen (JPY) before pulling back. Analysts at UOB Group believe that the upward trend might drive the USD toward a target of 154.90. In the last 24 hours, the USD unexpectedly surged to 154.44, breaking the expected range-trading pattern. Although this rise was quick, testing the 154.50 level before a possible drop seems likely. To keep this momentum going, the USD needs to stay above 153.30, with some support at 153.60. Over the next 1-3 weeks, USD’s outlook has changed from a mixed prediction of 151.00 to 153.30. The rapid increase to 154.44 suggests potential gains toward 154.90. However, if it drops below 152.50, it may signal a loss of upward momentum. Given the strong upward movement, there’s a chance that USD/JPY will test the 154.50 level. Traders could think about short-dated call options to take advantage of this push. The key is to see if the pair can hold above the support level of 153.30. It’s important to be cautious at these levels since there is a real risk of intervention from Japanese authorities. We remember the sudden yen buying in late 2022 when the dollar was strong, and recent warnings from the Ministry of Finance indicate they are closely monitoring the situation. Thus, maintaining long positions could be risky, as any reversal may be quick and significant.Trading Strategy and Considerations
For traders expecting an upward move, buying call options with a strike price near 154.50 provides a way to participate with defined risk. Implied volatility is likely high, so consider using call spreads to minimize entry costs. The goal is to take advantage of a quick move to 154.90 before any pullback. Alternatively, this is a good time to buy put options as a hedge or to speculate on a policy response. A drop below the important support level of 152.50 would indicate that upward pressure has weakened, possibly leading to a larger decline. These puts can offer protection against a sudden market reversal. The fundamentals support a strong dollar, especially with the latest US inflation data showing a solid 3.5% for September 2025, keeping the Federal Reserve alert. This is in stark contrast to Japan, where rates are near zero, despite core inflation being at 2.8%. This significant interest rate difference largely drives yen weakness. In conclusion, a balanced strategy involves managing both the upward momentum and the substantial downside risk. We suggest positioning for one last upward move while also holding protective puts. This approach allows for potential gains while being prepared for a likely sharp correction in the coming weeks. Create your live VT Markets account and start trading now.ECB holds policy rate steady, causing EUR/USD to fluctuate just above 1.1540
The EUR/USD pair is trading slightly above its monthly low of 1.1540. The next support level is at 1.1500. The European Central Bank (ECB) has held the policy rate steady at 2.00% for the third consecutive meeting, indicating that further easing is not expected.
The ECB noted that economic growth is continuing, even amidst global challenges. President Christine Lagarde has reaffirmed the current monetary policy. Current market swaps indicate a 50% likelihood of a 25 basis points cut in the coming year. However, stable Eurozone inflation and improving PMI data suggest that a pause is more likely.
