The USDJPY pair is close to an important resistance level as everyone looks ahead to decisions from the Bank of Japan (BoJ) and the Federal Open Market Committee (FOMC). The USD has gained back some strength, but there isn’t a clear reason for it, and the market is waiting for new factors to establish a lasting trend. The dominant strategy is to go “short US dollar,” which needs a significant event to fuel expectations for further rate cuts. Tokyo’s recent consumer price index (CPI) numbers were lower than expected, which did not help the JPY. A rate hike by the end of the year was already predicted after the US-Japan trade deal. For the JPY to gain more strength, we need either weak US data that supports dovish expectations for the Fed, or higher inflation in Japan that might lead to more rate hikes. Political changes, such as increased fiscal support, could also raise hopes for stronger economic activity and additional rate hikes.

Technical Analysis

In the daily chart, USDJPY is approaching the 148.30 resistance level. Sellers might sell around this point, aiming for a drop to the 142.35 support level, while buyers hope for a breakout to the 151.20 resistance. On the 4-hour chart, there’s minor support at 147.00, where buyers may step in, looking for a rally, while sellers may target a fall to 142.35. Looking at the 1-hour chart, an upward trendline supports bullish momentum. Buyers may depend on this trendline to reach new highs, while sellers are poised to break toward 147.00. Key upcoming factors include US economic data and the rate decisions from both the BoJ and FOMC, which could affect market movements. With major central bank meetings this week, derivatives markets indicate a near 100% chance that the Fed will maintain its interest rates. However, the CME FedWatch Tool shows over a 40% likelihood of a rate cut by March, making the upcoming statement crucial for market direction. This means traders should consider using options to protect against a unexpectedly hawkish tone, which could drive the USDJPY pair higher. On the Japanese side, recent core inflation figures dropped to 2.3% in December, suggesting a major policy change is not on the horizon. We believe this allows the central bank to wait, likely until spring wage talks, before ending its negative interest rate policy. As a result, buying short-dated call options could help traders who want to profit from potential disappointment for yen bulls this week.

Historical Interventions

As the currency pair tests upper levels, we should recall the Ministry of Finance’s verbal and actual interventions in late 2022 when the pair surpassed 150. This past suggests that even if we break the immediate resistance, there will likely be official warnings if we move toward the next major level. Traders might find it beneficial to sell call spreads above 150 to take advantage of this historically limited upside. The busy schedule of U.S. economic data, like job openings and the employment report, presents significant event risks. We expect volatility to spike leading up to these important releases, especially with the non-farm payrolls report on the horizon. A long straddle or strangle strategy could be a smart way to prepare for a possible large price movement in either direction, regardless of the results. We should also be aware of the positioning imbalance, which shows a significant speculative bet against the USD. Recent data from the Commodity Futures Trading Commission (CFTC) indicates that net short positions on the dollar are substantial, increasing the risk of a sharp rally if this week’s data or central bank tone surprises positively. This risk suggests that any bearish positions should be safeguarded with tight stop-losses or by purchasing out-of-the-money calls for protection. Create your live VT Markets account and start trading now.

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Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume”.

Please refer to the table below for more details:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected].

Today, there isn’t much economic data coming out, with only the Dallas Fed Manufacturing index being released. This index is known to be unpredictable and usually doesn’t have a big impact. Focus remains on trade agreements as the August 1 deadline approaches. Over the weekend, a US-EU trade deal was reached, which includes a 15% tariff cap.

Trade Predictions and Outcomes

This outcome matches expectations that tariff rates will stabilize between 10% and 20%. Trade discussions have been active since April 9, reaching a pivotal moment. The trend for risk assets is expected to continue, unless a new event emerges that could increase momentum or cause a shift. With fewer economic reports expected, the market seems to be waiting. The CBOE Volatility Index (VIX) stands near 13, significantly lower than the historical average of 20. This indicates that investors are feeling quite relaxed. In this low-volatility environment, there is a chance to take advantage before the next significant event occurs. We now shift our focus from the settled US-EU trade situation to domestic inflation data. The upcoming Personal Consumption Expenditures (PCE) price index is crucial, particularly since a recent report indicated core PCE at 2.8%, above the Federal Reserve’s target. If the number deviates from expectations, it could easily disrupt the current market calm and lead to noticeable changes.

Investment Strategy Considerations

For those optimistic about the ongoing upward trend, buying call options on broad market indices like the S&P 500 could be beneficial. This approach allows for greater gains if positive economic news helps continue the rally. Given the current risk-on sentiment, this strategy seems promising. However, it’s wise to think about protecting against a downturn, especially since the article hints that the peak of this trend might be near. With volatility so low, purchasing put options on key indices or particular stocks is relatively affordable. This serves as a safety net against sudden market shifts caused by unexpected data. The main takeaway is that a substantial market move is more likely than a long period of stagnation. Therefore, we should explore strategies that profit from an increase in volatility, regardless of the market’s direction. This could involve investing in options that gain from a breakout out of the current narrow trading range. Create your live VT Markets account and start trading now.

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European stocks are on the rise. Eurostoxx futures jumped by 1.2% in early trading, thanks to a US-EU trade deal that has eased market worries. This agreement is seen as temporary, and European leaders are looking for better terms. Even so, a 15% baseline tariff is expected to stay the same. At the same time, US markets are positive, with S&P 500 futures up by 0.5%.

Market Opportunity

The current market strength presents a short-term chance to ride this positive wave. We think this is a good time to use short-dated call options on the Eurostoxx 50 index. This strategy lets us join in on the immediate rally while also managing our risk. However, we need to keep in mind that this agreement is not permanent. The Euro Stoxx 50 Volatility Index (VSTOXX) has dropped below 17, suggesting less fear in the market. This might be a good opportunity to buy protection at a lower cost. The drop in implied volatility indicates that the market may be underestimating risks from possible future trade disputes. Still, there’s caution regarding the economy. The latest Eurozone Manufacturing PMI is at 47.3, which means it’s still shrinking. With core inflation stubbornly high, the base for a steady rally looks weak. These factors show that the current market optimism is on shaky ground.

Strategic Hedging

Our strategy will be to protect any new positive positions. While we enjoy the current gains, we are also buying out-of-the-money puts that will expire next quarter. This acts as a budget-friendly insurance policy against a possible downturn when the initial excitement wears off. We’ve seen similar patterns in the past, like during the temporary US-China trade pause in late 2018. That situation caused a quick market boost that eventually faded when the core issues remained unsolved, resulting in renewed volatility. We expect a similar trend might happen in the coming weeks. Create your live VT Markets account and start trading now.

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Donald Trump has made his ambitions plain. He wants to go down in history as the greatest American president.

To realise that vision, he is taking cues from one of the most iconic Republican leaders of the modern era – Ronald Reagan.

Like Reagan, Trump is embracing a revivalist strategy focused on tax reductions, a strong military, and trade tariffs to boost domestic industry.

While the surface comparisons are tempting, the context, economic realities, and global environment diverge significantly.

A Common Tool With Different Goals

Ronald Reagan wielded tariffs with care. In the 1980s, his administration pushed Japan to impose voluntary export restraints (VERs), a form of negotiated limits on products like cars and steel.

These weren’t intended as permanent barriers, but rather as bargaining chips to help American firms gain better access to overseas markets.

Trump’s approach has been far more sweeping. In his first term, he engaged in trade battles with China, the EU, Mexico, and Canada. His latest proposals go further still.

For his 2025 campaign, Trump floated a ‘universal baseline tariff’ of 10% on all imports, which has since evolved into a layered system. The default now applies a 10% levy across the board.

Tariffs aimed at China are as high as 60%. But in most cases, they hover around 30%, with steeper rates directed at sectors like steel, semiconductors, and EVs.

Additional duties have been tacked on to specific goods and trading partners, such as 25% on cars, 50% on metals, and tariffs ranging from 11% to 50% for imports from Canada, Mexico, and the EU.

Unlike Reagan, Trump is not using tariffs as temporary pressure points. For him, they represent a long-term pillar of his economic strategy. It’s a far more entrenched policy shift.

Contrasting Economic Backdrops

Reagan entered office during a time of significant inflation of around 11%. The Federal Reserve, led by Paul Volcker, was determined to rein it in.

The result was eye-watering interest rates that peaked above 20%, pushing the economy into a deep recession in 1982.

That short-term pain laid the foundation for years of falling inflation, declining interest rates, and robust growth through the rest of Reagan’s presidency.

The Reagan administration also had more fiscal flexibility. With debt at roughly 30–40% of GDP, there was room to cut taxes and boost defence spending without pushing fiscal limits.

On the global front, economic integration was in its infancy. America still had a solid industrial core, and Japan, not China, was its main economic rival.

In contrast, Trump would return to office under very different circumstances. Debt levels are now above 120% of GDP, severely limiting fiscal headroom.

Interest rates remain elevated due to lingering inflation concerns, despite significant rate hikes by the Fed. Core inflation remains stubbornly above the 2% target.

June's uptick in consumer prices likely gives the Fed room to stay on hold as uncertainty over tariffs clouds the timing of its next rate cut, according to economists. https://t.co/L5oly2EtCt

— Yahoo Finance (@YahooFinance) July 18, 2025

Global supply chains are tightly interwoven, and the US is heavily reliant on imports from many of the countries targeted by Trump’s tariffs. Decades of outsourcing have weakened the domestic manufacturing base.

Meanwhile, Trump faces a fractured geopolitical backdrop: an emboldened China, a protectionist Europe, and an increasingly polarised domestic political scene, with little bipartisan unity on trade or fiscal matters.

Reagan caught a favourable economic cycle after a short downturn. Trump would be walking into stormy conditions of fiscal stress, high rates, global competition, and an industrial ecosystem that can’t be easily rebuilt.

Reagan’s Results: A Mixed Scorecard

History largely views Reagan’s economic stewardship favourably. After the deep recession of 1981–82, GDP growth rebounded strongly, averaging over 4% annually between 1983 and 1989.

Unemployment fell from a peak near 11% to around 5% by the end of his presidency. Inflation dropped, strengthening consumer purchasing power.

Markets also boomed. The S&P 500 rose beyond 250% during Reagan’s tenure, boosting investor sentiment.

However, that success came with costs. National debt soared from roughly $900 billion to $2.7 trillion, triggering long-term deficit concerns.

Inequality also widened. Wealth gains largely flowed to the top, fuelling criticism of Reagan’s ‘trickle-down’ policies.

Importantly, Reagan’s tariffs were targeted and temporary. They were lifted once objectives were achieved, not to become a permanent fixture of American economic policy.

Can Trump Repeat The Feat?

Trump’s blend of sweeping tax cuts and large-scale tariffs poses far greater risks today.

It may deliver a short-term boost in business confidence, but structural hurdles could quickly undermine any progress.

One concern is the reaction from bond markets. Piling tax cuts on top of already bloated deficits could spook investors, pushing Treasury yields higher.

This would negate the stimulative effect of tax policy, especially in sectors sensitive to borrowing costs, like housing and tech.

There’s also inflation to consider. Broad tariffs would likely raise costs for both producers and consumers at a time when the Fed is still fighting price pressures.

If inflation accelerates, the Fed might delay interest rate cuts or even resume tightening, putting further strain on growth.

Today’s US economy cannot replace imports at short notice. Rebuilding local capacity would take years. In the near term, tariffs may only serve to drive up prices and slow output.

Internationally, the stakes are even higher. The US now faces scepticism from allies, growing competition from China, and a more fragmented global order.

This is a far cry from the Cold War-era unity that Reagan could rely on.

For Trump to succeed, he would need to bolster fiscal credibility, craft robust industrial policies, manage inflation carefully, and reforge a coherent diplomatic strategy without alienating key trade partners.

Conclusion

Trump and Reagan both believed in America’s exceptionalism and the power of tariffs. But while Reagan operated in a period of low debt, falling inflation, and strong industrial capacity, Trump faces a vastly more fragile landscape.

Reagan delivered real growth and renewed confidence, though not without fuelling inequality and long-term debt.

For Trump, the path forward is steeper. If he hopes to equal or surpass Reagan’s legacy, he must show that aggressive tariffs and deep tax cuts can foster lasting prosperity without destabilising markets, fuelling inflation, or isolating America on the world stage.

Being bold is one thing. In today’s world, only disciplined policy, sound economics, and smart diplomacy will separate rhetoric from real results.

USD/JPY has an option expiry at the 148.00 level on July 28 at 10 AM New York time. While this level isn’t tied to any major technical levels, it might still affect price behavior leading up to the expiry later that day. Market focus remains on trade developments, especially the US-EU trade talks. There are not many other important events happening at the start of the week.

Impact Of Large Option Expiries

Large option expiries can affect short-term price movements, often keeping the currency pair close to a specific level. Even though the 148.00 level has passed, traders should keep an eye on other significant expiries, like the recent interest around the 157.50 and 158.00 levels. These can pull prices toward them, especially when there’s no major economic data released. The market is also keeping watch on the differences between the Federal Reserve’s and the Bank of Japan’s policies. Recent US inflation data, like the core Personal Consumption Expenditures (PCE) index dropping to 2.6% annually, suggests the Fed could lower rates later this year. However, comments from leaders like Chairman Jerome Powell stress a focus on data, adding some uncertainty. This situation is very different in Japan, where officials are worried about the yen’s weakness. We should be particularly alert for intervention, especially as USD/JPY nears the 158 level. This area prompted significant yen-buying by authorities in late April and May 2024. Statements from Finance Minister Shunichi Suzuki and Governor Kazuo Ueda indicate that they may not tolerate further depreciation.

Trader Caution And Strategy

Given these circumstances, traders should be careful about driving the pair higher, as there is a notable risk of sudden drops due to official actions. Selling volatility through options might seem attractive because of the pinning effect of expiries, but holding long put options could serve as a good protection against intervention. This market requires a strategy that prepares for both calm periods and sudden price changes. Create your live VT Markets account and start trading now.

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 July 28, 2025 , Sydney, Australia – VT Markets is using the ‘power of football’ to make a positive impact in communities across Asia, supported by a partnership with Premier League club Newcastle United.

Celebrating its 10th anniversary, VT Markets committed to donating 1,000 Newcastle United branded footballs to schools across Southeast Asia. The initiative aims to deepen the brand’s presence in Asia while creating opportunities for future generations to enjoy the sport.  

Additionally, VT Markets proudly donated £20,000 to the Newcastle United Foundation, commemorating the club’s Carabao Cup victory and return to the UEFA Champions League. This contribution celebrates the club’s incredible achievement while supporting its official charity partner’s mission to harness the unifying power of football to connect, motivate, and inspire people through community, education, health, and sports programmes.  

VT Markets’ Corporate Social Responsibility initiatives have been designed to champion growth through strategic partnerships and investments, with the aim of expanding the brand’s footprint in Asia, while helping to nurture economic development in the region. By driving growth through impactful collaborations, VT Markets is not only deepening its regional presence but also helping to build a stronger, more resilient future for these communities. With plans already underway to bring similar initiatives to Latin America, the brand is looking to replicate this positive impact across even more global markets.

As Newcastle United’s Official Financial Trading Partner, first-team players including Sandro Tonali, Jacob Murphy, Dan Burn, and William Osula, kicked off the initiatives during an exclusive Meet and Greet session hosted by VT Markets. Also in attendance was club legend Shola Ameobi, who brought his trademark charisma to connect with fans at the event. The Magpies were based in Singapore ahead of their first fixture in the nation since 1996, taking on fellow Premier League side Arsenal as part of the Singapore Festival of Football.  

Speaking as the CSR initiatives were launched at an exclusive client engagement event in Singapore, hosted by VT Markets, Newcastle United player and Newcastle United Foundation ambassador Dan Burn shared: “Our fans are the soul of this club, wherever we go in the world. The support we’ve felt from everyone in Singapore has been unbelievable and that’s a big reason why projects like this mean so much.  

“As players, football has helped to transform our lives so it’s really special to see VT Markets use their position to support young people and give back to these amazing communities – both in Newcastle and across Asia. We see the fantastic work that Newcastle United Foundation do back home and this donation will make a great contribution to changing their lives of many people in our community.”

VT Markets recently marked a thrilling debut year as Official Financial Trading Partner of Newcastle United by visiting St. James’ Park for the final match of the 2024/25 Premier League season. A history-making campaign saw Eddie Howe’s side win the club’s first domestic trophy in 70 years, which was quickly followed up with qualification for the UEFA Champions League.

This year also coincides with a significant milestone for VT Markets, celebrating a decade of innovation in the global financial markets. Over the past 10 years, the company has driven growth through collaborations, expanding its presence and making a lasting impact within the industry by helping to build a stronger, more resilient future.

“At VT Markets, we believe that true growth goes beyond numbers. Through our CSR initiatives, we aim to inspire, empower, and contribute meaningfully to the region’s development, laying the foundation for long-term opportunity and success. Our partnership with Newcastle United is about driving positive change both on and off the field, and we look forward to deepening our impact as we continue this exciting journey in Asia together,” Dandelyn Koh, Global Brand and PR Lead at VT Markets shared.

As Newcastle United prepare for a return to the UEFA Champions League, VT Markets remains a steadfast partner, supporting ambitions on the pitch while helping to drive positive social change off the pitch. The event in Singapore served as an opportunity to highlight shared values and the vision of both organisations, centred around growth, community, and giving back.

For media enquiries and sponsorship opportunities, please email [email protected], or contact:  

Dandelyn Koh  

Global Brand & PR Lead  

[email protected]   

Brenda Wong  

Assistant Manager, Global PR & Communications  

[email protected] 

 

 

The French foreign affairs minister has shared thoughts on the US-EU trade deal, stating it will provide temporary stability. However, the European view sees this agreement as only a short-term fix.

Exempt Sectors and Market Balance

Some French sectors, like aeronautics and spirits, are set apart from the deal. Still, the overall arrangement feels unbalanced. This temporary deal may last for a few months or until the end of Trump’s presidency. While we have avoided the worst-case scenario, uncertainties about how the market sees this deal remain. People are wondering if it will ultimately be viewed in a positive light. The minister’s remarks suggest a brief period of calm, not a permanent solution. This creates a misleading sense of security, as the market’s real volatility might be overlooked. Therefore, derivative traders should focus on strategies that benefit from future uncertainty rather than relying on the short-term stability offered by this agreement. The CBOE Volatility Index (VIX), which measures expected market fluctuations, has recently stayed in the lower range of 13-15, reflecting this temporary relief. However, VIX futures show that contracts set to deliver in the coming months are priced higher, above 17 later in the year. This suggests that while things are calm now, the market expects increased volatility when the minister indicates this deal’s stability may fade.

Opportunities in Derivative Strategies

Given this situation, we see a chance in buying longer-dated call and put options on major market indices like the S&P 500 or the Euro Stoxx 50. Buying these options now, while their implied volatility is low, is more affordable than waiting for political tensions to rise again. This approach helps traders prepare for significant market shifts in the months ahead. Historically, periods of political calm have often led to sharp spikes in volatility. For example, during the US-China trade tensions in 2019, the VIX surged from below 15 to over 25 after seeming progress crumbled. This pattern suggests that the current stability is fragile and likely temporary. Even though specific sectors like aeronautics are momentarily protected, their long-term outlook remains linked to the imbalanced agreement mentioned by the minister. Thus, we are looking at protective puts on companies vulnerable to transatlantic trade, even those currently exempt. This is a smart way to hedge against potential issues with the deal later this year. More advanced strategies, like calendar spreads on major indices, might also be effective. This involves selling a short-term option to collect premiums from the current low-volatility environment, while buying a longer-term option to benefit from future uncertainty. This approach specifically caters to the kind of temporary stability we’ve been discussing. Create your live VT Markets account and start trading now.

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Cryptocurrencies are bouncing back after some midweek dips, with Ethereum showing strong growth. Over the weekend, it recovered from losses, climbing from around $3,600 to its highest price since December last year. The big question now is whether Ethereum will break the $4,000 barrier. This level was last crossed cleanly in late 2021 when it peaked over $4,800 before falling. During the same time, Bitcoin also hit record highs above $60,000 but later dropped below $20,000. Ethereum struggled with the $4,000 mark last year, but it’s ready for another attempt. If it can break through, there may be more gains ahead, but a failure could signal this year’s peak. Globally, the trend for cryptocurrencies and collectibles remains strong this summer. According to Low, the setup around $4,000 is an excellent chance for options traders. Recent data indicates a build-up in call option interest, with over $3 billion focused at strikes between $4,000 and $5,000 for late June, reflecting a strong bullish sentiment in the derivatives market. We believe that positioning for a breakout is the way to go. The situation has changed dramatically since the last time Ethereum tested this price due to the SEC’s recent approval of 19b-4 filings for spot Ether ETFs. This approval is a significant catalyst, making a sustained price break more likely. Historically, assets see major inflows and price rises once such products start trading. For instance, Bitcoin rallied over 60% after its ETF launch in January. For traders expecting a breakout, buying call options with a strike price just above $4,000 could amplify this upward trend. Those wary of a possible rejection can purchase put options to guard against a sharp drop. Data from Deribit shows that demand for bullish calls is still higher than for bearish puts. We also see potential in strategies that benefit from increased volatility, regardless of the direction. A long strangle—buying an out-of-the-money call and put—could be effective as we near the launch of the spot ETFs. The market seems to be anticipating a big move, and while implied volatility is high, it may still underestimate the impact of active ETF trading. Finally, it’s important to keep an eye on the S-1 registration statements, as this is the last step before these new funds start trading. We believe the market is not fully grasping the potential inflows, which analysts at Standard Chartered estimate could be between $15 billion and $45 billion in the first year alone. This event will likely set the tone for the rest of the quarter.

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The US has paused export restrictions on key technology to China to improve trade relations. This decision is aimed at setting up a meeting between Trump and Xi later this year. The commerce department has been told to avoid strict actions against China. China’s past use of rare earth exports for leverage in May has influenced this decision. However, it remains uncertain if this will lead to meaningful discussions between Trump and Xi.

US-China Temporary Truce

The US and China seem to have reached a temporary truce that may be extended, although no significant agreements are expected. The priority now is to maintain friendly relations between the two countries. With the recent pause in export controls, traders should expect lower market volatility. This truce reduces the risk of sudden market shocks caused by policy changes, which have previously unsettled investors. For example, during the trade war escalation in mid-2019, the VIX volatility index surged above 20, whereas it currently remains low at around 13, indicating a stable environment. This situation is beneficial for technology and semiconductor stocks that are heavily invested in the Chinese market. Companies like Qualcomm, which gets over 60% of its revenue from China, are good candidates for bullish strategies, such as buying call options or selling cash-secured puts. The removal of immediate threats should boost their stock values in the short term. On the other hand, China’s rare earth leverage could serve as a challenge for producers outside of China. We anticipate less investor interest in mining companies that previously gained from supply chain diversification narratives. In this context, buying put options on specific mining ETFs or stocks may be a useful strategy to hedge against broader market optimism.

Caution on Temporary Fix

While this effort to maintain friendly relations is welcome, it should be approached with caution, as it seems like a temporary solution. Despite the positive news, US goods trade with China dropped by over $70 billion in 2023, indicating a longer-term shift in strategy. Therefore, any optimistic derivative trades should be focused on the short term, as the underlying issues between the two nations are still unresolved and simply postponed. Create your live VT Markets account and start trading now.

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