Gold’s Record High
Uniswap’s price remains above $6, buoyed by anticipation surrounding the UNIfication proposal vote, which traders see as a potential market influencer. Similarly, XRP trades steadily above $1.90, with sustained investor interest supporting its position despite recent resistance challenges.
Predictions for 2026 suggest a potential shift in market dynamics, advising caution against relying on conventional strategies. Questions surrounding growth, inflation, and geopolitics remain pertinent as the new year approaches.
As we approach the end of 2025, trading volumes are thinning for the holidays, which means we should be cautious of sharp price swings on low volume. The general feeling is one of a potential regime shift, so we must avoid becoming complacent in what seem like defensive or crowded trades. This environment is ideal for using options to define risk.
EUR USD Strategy
The EUR/USD is showing strength, but with the Relative Strength Index nearing 70, a direct long position is risky heading into the new year. We could consider buying call spreads to cap risk while staying bullish, or selling out-of-the-money puts to collect premium from the elevated volatility. The ECB’s cautious tone, which we saw them maintain throughout 2024, continues to support the currency without promising aggressive action.
Sterling’s move to ten-week highs, even after a Bank of England rate cut, signals strong underlying demand from the market. We should look to protect long futures positions with protective puts, as holiday liquidity dries up and could trigger a sharp reversal. This resilience is similar to market behavior we saw in late 2023, when traders often looked past immediate central bank data and focused on longer-term inflation trends.
With gold pushing towards a record $4,500, momentum is clearly with the bulls, supported by a fundamental backdrop of geopolitical uncertainty. Using call options allows us to participate in further upside while strictly defining our risk, which is critical at these unprecedented price levels. This rally echoes the sustained move we witnessed beginning in late 2023 when gold broke out from the $2,000 level.
WTI crude dipping below $58 presents a bearish opportunity, especially with news of potential new supply hitting the market. We can look at buying put options or establishing bear put spreads to profit from a potential slide towards the mid-$50s. This supply concern adds to a fragile demand picture, as recent OPEC+ data from the third quarter of 2025 showed compliance among members starting to weaken.
The warning about a regime shift in 2026 suggests we should monitor broad market volatility itself. Implied volatility is often low during the holidays, making this a good time to consider buying longer-dated VIX call options as a cheap hedge against a new year surprise. We saw how quickly market sentiment shifted during the inflationary period of 2022-2023, and being prepared for a similar change is prudent.
