Insights 
VT 
Italy’s business confidence index increased to 88.3 in October, improving from the previous month’s figure of 87.3. This rise indicates an upward trend in sentiment among Italian businesses.
The EUR/USD currency pair held gains near 1.1650, with the US Dollar underperforming due to decreased safe-haven demand. The upcoming Federal Reserve monetary policy announcement has captured the market’s attention.
Gold Prices And Market Activity
Gold prices fell below $3,950, reaching a new three-week low amid reduced demand for safe-haven assets. The easing of trade tensions between the US and China may be a contributing factor.
Cardano’s market activity is drawing attention as on-chain data suggests increasing whale accumulation, likely paving the way for a potential price breakout. The digital currency is trading at approximately $0.66 after a prior rejection at a key level.
Except for brief elements of other content, this document focuses on financial market observations and projections. It also contains advisory directives, emphasising the content’s purpose for information and not as a recommendation for market actions. Caution is advised, stressing the need for independent research before investments.
Given the rise in Italian business confidence, we should anticipate a potential tailwind for European assets. This slight improvement, now at 88.3, could signal a bottoming out of sentiment in the Eurozone’s third-largest economy. We can look at buying call options on the Euro Stoxx 50 to position for broader European equity strength in the coming weeks.
Federal Reserve Policy And Market Implications
The market is clearly pricing in a dovish Federal Reserve, with the US Dollar weakening and EUR/USD pushing towards 1.1650. Recent data showed US core PCE inflation easing to 2.5% year-over-year, giving the Fed room to soften its stance. This reinforces the strategy of selling US Dollar index futures or buying put options on the dollar against a basket of currencies.
With a US-China trade framework deal seemingly in place, demand for safe havens is dropping off. Gold is already at a three-week low, and we expect this trend to continue as capital flows into riskier assets. Selling gold futures or buying puts on gold ETFs appears to be the most direct way to play this shift in market sentiment.
Despite the positive mood, the upcoming Fed announcement introduces significant event risk. We saw how markets reacted with sharp swings to the policy pivots back in 2023, so positioning for a spike in volatility is prudent. A simple straddle on the S&P 500 using options could protect us from being caught on the wrong side of a surprise announcement.
The contraction in UK shop price inflation points to specific weakness in the British economy. This follows the Bank of England’s recent projections showing UK GDP growth for 2026 revised down to just 0.8%, highlighting underlying economic softness. Therefore, a relative value trade of buying the Euro against the Pound Sterling could be attractive, isolating European optimism from UK-specific concerns.
