In October, the average weekly hours worked in the United States were 34.3, up from 34.2.
In October, US Retail Sales remained steady at $732.6 billion, as reported by the US Census Bureau. This followed a slight increase of 0.1% in September. However, this result fell short of the market’s expectation for a 0.1% growth.
GBP/USD climbed to a two-month high above 1.3430. This rise was fueled by positive PMI data from the UK and a weaker US Dollar, which struggled due to mixed employment reports and less favorable PMI data.
Retail sales in the United States see no growth, missing the expected 0.1% increase
Slowdown for American Shoppers
In October, retail sales in the United States stayed flat at $732.6 billion, according to the US Census Bureau. This stability comes after a slight 0.1% increase in September, which was revised down from an initial estimate of 0.3%. October’s results did not meet the expected 0.1% growth. The steady retail sales in October, along with the downward revision for September, signal a slowdown for American consumers. This suggests that the economic slowdown we’ve been predicting is becoming reality as we head into late 2025. The data indicates cautious holiday shopping and a weak start to the new year. Other recent figures support this trend. A November jobs report showed only 85,000 new jobs, and last week’s CPI data revealed core inflation dropped to 2.4% annually. These numbers indicate that inflation is under control, which puts pressure on the Federal Reserve to change its policies. We now see a greater chance of a rate cut in early 2026.Market Opportunities
In light of this outlook, we are exploring interest rate derivatives that could benefit from a more dovish Federal Reserve. Options on SOFR futures for the second quarter of 2026 look appealing, as they let us position for lower rates. Looking back to late 2023, we noticed how quickly market sentiment can change and how it can price in future cuts even before they are officially announced. For equity traders, a careful but focused approach is necessary. We are thinking about protective put options on consumer discretionary ETFs, which are more vulnerable to a spending decline. Meanwhile, lower rates could help technology and growth sectors, making call options on the Nasdaq 100 index a potential safe choice. In currency markets, ongoing weak U.S. economic data is likely to put pressure on the dollar. Predictions of earlier Fed rate cuts lower the dollar’s yield advantage compared to currencies like the euro and yen. We are therefore looking for chances to use options on the U.S. Dollar Index (DXY) to prepare for further declines. Create your live VT Markets account and start trading now.Nonfarm Payrolls in the United States decrease to 64,000 from 119,000
In October, the United States saw a drop in nonfarm payrolls, which fell to 64,000 from 119,000 in September. This change might affect exchange rates, as shown by the GBP/USD pair’s reaction.
The U.S. economic indicators are mixed. In December, the S&P Global Manufacturing PMI dropped to 51.8, and the Services PMI fell to 52.9. Meanwhile, U.S. retail sales were stable at $732.6 billion in October.
Geopolitical Tensions Impact
Ongoing geopolitical tensions between Ukraine and Russia continue to impact various markets. Gold prices have decreased a bit after last week’s gains, and traders are cautious due to these tensions. In cryptocurrency, Binance Coin (BNB) is trading around $855 as bearish trends persist. Increased retail activity may affect its future performance. The October jobs report, which showed only 64,000 new jobs, has created a negative outlook for the U.S. economy this quarter. The recent December S&P Global PMI data, showing declines in both manufacturing and services, supports our idea that a significant slowdown is occurring. This trend of weakening data suggests tough times ahead as we approach 2026.Federal Reserve Rate Speculations
We think the recent soft economic reports make a Federal Reserve rate hike in early 2026 very unlikely. Traders should pay attention to derivatives related to the Fed Funds Rate, as the market is now expecting a higher chance of a rate cut in the first half of the year. Currently, futures pricing indicates over a 50% likelihood of a rate cut by the end of the second quarter, up from just 20% a month ago. The immediate effect has been a weaker U.S. dollar, which has fallen below key technical levels against the Euro and Pound Sterling. This trend suggests that strategies like buying call options on currency pairs such as EUR/USD could be wise for potential gains. A similar situation occurred in late 2023 when signs of economic slowing led to a quick dollar sell-off. For equity indices like the S&P 500, this economic slowdown poses challenges for corporate earnings and overall market sentiment. We may want to consider protective strategies, such as buying put options on major index ETFs, to guard against a potential downturn. The CBOE Volatility Index (VIX) has already risen from its lows last month to above 18, indicating that traders are starting to factor in more risk. Create your live VT Markets account and start trading now.Retail sales in the United States decreased to 3.5% year-on-year, down from 4.3%.
Retail Sales in the United States were $732.6 billion in October, showing little change from the previous month. This comes after a revised 0.1% increase in September, which was below the market expectation of a 0.1% rise.
Gold’s Performance
Gold traded positively, crossing $4,300 after shaking off earlier bearish trends. This occurred as the USD weakened due to news that the Unemployment Rate rose to 4.6% in November, along with December PMI data revealing slower private sector growth. The GBP/USD pair climbed to a new two-month high, surpassing 1.3400. This increase was driven by favorable PMI data and the USD’s struggles amid mixed employment reports. The latest economic data has caused different responses in the market, influencing gold and GBP/USD while also showing broader weakness in the USD. Clear signs indicate a cooling US economy as we move into the new year. The slowed year-over-year retail sales growth of 3.5% and October’s flat performance suggest a decline in consumer spending. This trend recalls the economic softening seen in late 2023, which led policymakers to adopt a more cautious approach.Federal Reserve Considerations
This economic data supports the idea that the Federal Reserve may pause or change its stance, a view now reflected in the derivatives market. Fed Funds futures currently indicate at least a 60% chance of a rate cut by the second quarter of 2026. This suggests that strategies focusing on lower interest rates through Treasury futures options may become prominent in the coming weeks. The US Dollar’s weakness has opened up opportunities in currency pairs like GBP/USD, which recently reached a two-month high above 1.3400. With the UK’s Services PMI reporting strong growth at 54.1, the different economic conditions favor buying call options on the pound. Implied volatility in major USD pairs has risen nearly 15% over the past month, making options strategies appealing. Gold’s rise above the key $4,300 mark should be noted as an important sign for the upcoming weeks. Historically, when gold breaks major levels during times of falling real yields, it gains significant momentum. With the 10-year Treasury yield dipping below 3.8% last week, call spreads on gold futures present a defined-risk way to pursue potential gains. Overall, rising uncertainty is elevating the VIX index, which has climbed from lows of 14 to over 19 in the last six weeks. This environment favors strategies that profit from increased price volatility, such as long straddles on major indices. Using options to manage risk will be essential as the market assesses whether this slowdown is a minor setback or a more significant issue. Create your live VT Markets account and start trading now.The U6 underemployment rate in the United States recently decreased from 8% to 5%
The U6 underemployment rate in the United States dropped to -5% in November, down from 8% in October. This change shows that the labor market is improving.
Retail sales in the US stayed steady at $732.6 billion in October. This came after a slight rise of 0.1% in September, which did not meet expectations for another 0.1% increase.
Gold Prices Rise Due to Weaker US Dollar
Gold prices went up and reached above $4,300 due to a weaker US dollar. The US unemployment rate also rose to 4.6% in November. Additionally, PMI data showed a slowdown in growth for the private sector in December. The US S&P Global Manufacturing PMI fell to 51.8, and the Services PMI decreased to 52.9 in December. These numbers indicate less growth in the manufacturing and service sectors compared to earlier months. Major currency pairs like EUR/USD and GBP/USD gained value as the US dollar weakened. The EUR/USD approached 1.1800, while the GBP/USD hit its highest point since mid-October, influenced by weak US employment data. BNB (Binance Coin) dropped below $855, influenced by negative signals. This decline in BNB happened alongside increased retail activity and poor market sentiment.US Economic Data is Confusing
Recent US economic data presents a mixed picture. The U6 underemployment rate seems unusual and should be viewed skeptically until confirmed, especially since other important indicators show a slowdown. For example, November added only 64,000 jobs, and the unemployment rate rose to 4.6%. Markets appear to overlook the U6 anomaly, focusing instead on the broader job data and falling PMI figures. This situation has put pressure on the US dollar, which we expect to continue into the new year. Markets are anticipating over a 75% chance of a Federal Reserve rate cut in the first quarter of 2026, according to the CME FedWatch tool. This suggests that the dollar is likely to keep weakening. Traders should consider buying call options on pairs like EUR/USD and GBP/USD for potential gains while managing risk. Gold’s rise above $4,300 is directly linked to the weak dollar and increasing economic uncertainty. This trend mirrors what happened during the 2020 financial crisis, when a dovish Fed and stimulus measures led to a surge in precious metals. Taking long positions in gold futures or call options may be wise to take advantage of this shift to safety and the dollar’s decline. The outlook for stock indices is more uncertain, leading to a potentially volatile market. While slow economic growth usually hurts stocks, the chance of rate cuts could provide some support. This conflict between weak growth and accommodating monetary policy suggests there could be significant price swings ahead. Given this uncertainty, options that capitalize on volatility are appealing. The VIX has risen from its fall lows and is now around 22, indicating growing investor concern. We suggest traders look into buying straddles on the S&P 500, a strategy that could pay off if the market moves significantly in either direction soon. Create your live VT Markets account and start trading now.In November, the actual average weekly hours in the US exceeded forecasts, reaching 34.3.
In November, the average weekly hours worked in the United States were better than expected, reaching 34.3 hours, compared to the forecast of 34.2 hours. This increase aligned with a small rise in Nonfarm Payrolls, which grew by 64,000 in November after dropping by 105,000 in October.
US retail sales remained almost the same in October at $732.6 billion, which did not meet market expectations. A prior adjustment showed a smaller increase of 0.1% instead of 0.3% for September, indicating a stagnant retail market.
PMI Numbers Show Slowdown
The US S&P Global Manufacturing PMI decreased to 51.8, while the Services PMI fell to 52.9 in December. These numbers come after mixed employment reports, showing that growth in the private sector is slowing. In the markets, the GBP/USD rose above 1.3400, thanks to positive PMI data as the US Dollar weakened. At the same time, gold prices went above $4,300, benefiting from the weakened dollar following the recent jobs report, which showed an unemployment rate rise to 4.6% in November. We are observing clear signs of a slowing US economy as the year ends. The latest December data reveals that manufacturing and services are losing steam. Job numbers from November were mixed, and retail sales have plateaued. This trend suggests we may see ongoing economic challenges moving into the new year. The US Dollar is dropping due to this weak data, especially with the unemployment rate sitting at 4.6%. Markets now expect that the Federal Reserve might pause its rate hikes or even begin lowering rates in 2026. This expectation is similar to the policy shifts we saw in late 2023, which is causing pressure on the dollar.Strategies for Traders
For currency traders, this indicates a strategy to anticipate further dollar weakness. It might be wise to buy call options on pairs like EUR/USD and GBP/USD, which are already gaining strength. This approach allows traders to benefit from the trend while minimizing risk. On the stock side, the slowing economy could affect corporate earnings. The VIX, which measures market fear, has risen to over 20, compared to an average of 17 in the third quarter. Buying put options on major indices like the S&P 500 could be a smart move to protect against a potential market decline in the coming weeks. Gold is significantly benefiting from the weak dollar and overall market uncertainty. Its jump above $4,300 an ounce shows that investors are seeking safety. We believe this trend will continue, making long call options on gold futures or related ETFs an appealing choice. Create your live VT Markets account and start trading now.The U6 underemployment rate in the United States is now 8.7%, up from 8% previously.
The U6 underemployment rate in the United States rose from 8% to 8.7% in November. This change highlights larger issues in the labor market that go beyond the official unemployment statistics.
In December, the US S&P Global Manufacturing PMI dropped to 51.8, and the Services PMI fell to 52.9. Retail sales in the US were nearly unchanged at $732.6 billion in October, missing the expected 0.1% increase.
Currency Movements
The weak USD affected currency movements, with GBP/USD climbing over 1.3430. Similarly, EUR/USD reached a three-month high following a drop in nonfarm payrolls by 105,000 in October, followed by an increase of 64,000 in November. Gold prices surged above $4,300, driven by the weaker USD and disappointing employment and PMI data. Meanwhile, BNB fell below $855 due to negative momentum indicators and increased retail activity. Global tensions and economic events also impacted the markets. Peace talks between Russia and Ukraine were noted, along with economic challenges in Venezuela. FXStreet offers market insights but urges thorough research before making investment decisions. The rise in the U6 underemployment rate to 8.7% indicates that the US labor market is in worse shape than it appears. Historically, this broader measure of unemployment serves as an early warning sign of economic issues. Coupled with stagnant retail sales and declining PMIs, it shows a clear slowdown as we approach the new year.Federal Reserve Rate Cuts
The current trend of weakening data increases the likelihood of Federal Reserve interest rate cuts in the first half of 2026. This uncertainty presents opportunities, suggesting we consider strategies that benefit from rising market volatility, such as buying call options on the VIX. A similar situation occurred in 2019 when slow growth forced the Fed to change direction, causing sharp market reactions. With soft US jobs data, the US Dollar is expected to remain under pressure in the coming weeks. We are already witnessing this, as the Euro and Pound Sterling are rallying against the dollar. Using derivatives to take advantage of this trend, like buying EUR/USD call options or shorting US Dollar Index futures, seems to be a straightforward approach. Gold’s rise above $4,300 is a typical reaction to a declining dollar and economic uncertainty. We can maintain long exposure through futures, as ongoing geopolitical risks related to Russia and Ukraine could support prices. However, for stock indices, caution is advised; while potential rate cuts may be bullish, weakening economic activity is bearish, making protective put options a wise hedge for any existing long positions. Create your live VT Markets account and start trading now.Retail sales in the United States surpass expectations with a 0.8% increase instead of the predicted 0.3%
**Retail Sales and Job Growth Analysis**
Retail sales data is part of a broader analysis that includes Nonfarm Payroll data. For October, this data showed a dip in job growth compared to previous months.
This decline in job growth could affect monetary policy and market expectations. Analysts predict various impacts on future economic indicators and decisions by the Federal Reserve and other central banks regarding interest rates and economic support.
The mixed retail sales report for October 2025 hinted at the economic slowdown we’re currently experiencing. Recent figures support this, such as the November jobs report showing hiring has slowed to just 120,000. Inflation is also easing, with the latest Consumer Price Index for November indicating core inflation at an annual rate of 2.8%.
**Federal Reserve Policy and Market Strategy**
This economic slowdown is changing expectations for Federal Reserve policy moving into early 2026. Traders are using SOFR futures to predict a high chance of at least two interest rate cuts by the end of the second quarter next year. This is a significant shift from a few months ago when the focus was on keeping rates high for a longer period.
The uncertainty about when the Fed will make its first move is creating opportunities in the volatility markets. We are preparing for potential market fluctuations by utilizing options on the VIX index. Reflecting on the pivot from late 2023, we’ve seen that even an anticipated policy change can lead to short-term instability before markets stabilize.
The likelihood of lower U.S. interest rates compared to other major economies is weakening the dollar. As a result, we are considering buying call options on the EUR/USD pair, expiring in March 2026. This strategy allows us to benefit from a declining dollar as the narrative around rate cuts develops.
Expectations of monetary easing usually boost equities, particularly technology and growth stocks that are sensitive to interest rates. We are increasing our exposure through call spreads on the Nasdaq 100 index (NDX). This strategy enables us to engage in a potential rally while also managing our risk if the economic slowdown is more severe than anticipated.
Create your live VT Markets account and start trading now.
In November, US nonfarm payrolls exceeded projections by adding 64,000 more jobs than expected.
The US Nonfarm Payrolls added 64,000 jobs in November, surpassing the expected 50,000. This followed a downward revision in October, which saw a loss of 105,000 jobs. This trend indicates that the labor market is recovering slowly.
The Unemployment Rate rose to 4.6% in November, highlighting ongoing struggles. These mixed results in job growth may affect the Federal Reserve’s decisions on economic support as they analyze job creation trends.
Retail Sales and Economic Indicators
In October, retail sales in the US were almost unchanged at $732.6 billion, showing no signs of growth. This suggests that consumers are being cautious. The US S&P Global Manufacturing PMI fell to 51.8, while the Services PMI dropped to 52.9 in December, indicating a potential slowdown in economic growth. The lower job growth and stagnant retail sales paint a complex picture of the US economy. These developments may influence the decisions of the central bank and trends in the market. The recent job report, which shows a 64,000 increase in November payrolls, may appear better than it is. The unemployment rate also went up to 4.6%, and looking back, we see that October’s numbers were revised to reflect a substantial loss of 105,000 jobs. This data suggests a cooling labor market, likely prompting the Federal Reserve to consider more supportive measures.Market Predictions and Strategies
It’s important to remember the strong job growth seen in early 2020s, where monthly gains often exceeded 200,000. Today’s figures, along with falling manufacturing and services PMIs, clearly indicate a loss of economic momentum. The stagnant retail sales data from October reinforces that consumers are becoming more cautious. Given these trends, the chances of a Fed rate cut in the first quarter of 2026 have risen significantly. Traders dealing in derivatives should think about adjusting their strategies for lower interest rates, perhaps looking into options on interest rate futures. According to the CME’s FedWatch Tool, market expectations are shifting towards a more dovish outlook from the central bank. The uncertainty from a slowing economy paired with a potentially supportive Federal Reserve can lead to increased market volatility. Buying call options on the VIX may be a good strategy, as this index is likely to rise amid these mixed signals. Historically, the VIX has surged during times of economic uncertainty, like the downturn seen in late 2023. A weaker US economy and the expectation of lower interest rates may also put pressure on the US Dollar. This scenario makes shorting the dollar an appealing strategy. Traders can express this view by buying put options on dollar-tracking ETFs such as the UUP. Create your live VT Markets account and start trading now.Analysis suggests a bullish trend for TSM, targeting $340, with potential near-term corrections noted.
Taiwan Semiconductor (NYSE: TSM) is on a strong upward trend. Analyzing the daily Elliott Wave structure gives us insight into potential targets and short-term corrections ahead.
TSM’s rise began from a low of $134 in April 2025. It has moved through several waves: Wave ((1)) peaked at $248, Wave ((2)) dipped to $223, Wave ((3)) rose to $311, and Wave ((4)) found support at $266. Now, Wave ((5)) has reached new heights. This upward movement may continue as long as the price stays above $266. If that holds, we could see prices move into the $321–$338 range, indicating the end of the larger Wave III rally.
After completing Wave III, TSM will go through a daily Wave IV correction. This correction will feature either 3, 7, or 11 swings. It presents a good buying opportunity before the bullish trend picks up again. Market participants should watch for entry points after these corrections. Using Elliott Wave strategies and proprietary systems can help spot high-probability areas for potential gains.
The rally starting from the $134 low in April 2025 seems to be nearing its peak. Positive momentum from the Q3 earnings call and news on the 1.4-nanometer process have boosted this climb. We are targeting the $321 to $338 zone as the likely peak for this wave.
For traders looking for one last surge, buying near-term call options that expire in January or February 2026 could be a smart move. Aiming for strike prices around $325 or $330 allows you to take advantage of a final push toward this target zone. However, we should be cautious, as implied volatility is high, making these options pricier than a few weeks ago.
As the stock approaches this target area, we should shift to strategies that can benefit from the expected correction. Buying put options is a direct strategy to profit from a price drop once the upward momentum slows. Alternatively, selling out-of-the-money call credit spreads offers a safer way to bet against prices moving past $340.
This perspective is backed by recent market data, with Wall Street aligning around a $330 price target for early 2026. We have also noticed implied volatility for at-the-money January 2026 options rising above 45%, indicating the market is preparing for a substantial price movement. This resembles the price behavior in late 2023, which led to a 15% pullback before the next big rally.
This upcoming pullback is seen as a strategic buying opportunity for the next major upswing. Once we identify the bottom of the correction, we will aim to establish new bullish positions using longer-dated call options expiring in September 2026. This strategy will enable us to re-enter the market at a lower cost and ride the next major wave toward new all-time highs.
