Insights 
VT 
Dip buying resumed after last week’s tariff concerns, with indices recovering losses following Friday’s events. A new deal between Broadcom and OpenAI has sparked optimism.
Over the weekend, both the US and China deescalated trade tensions, with US policymakers leading the efforts to stabilise the situation. Although sentiment has not fully recovered, it appears another trade war is unlikely at this point.
Broadcom Strengthened By Deal
Broadcom’s position as a major player in tech was strengthened by the deal with OpenAI. This development is welcomed news after Friday’s market shock, underscoring continued interest in computing power.
Additional analyses touch on the NZD/USD slump due to global trade stress and the EUR/USD decline amidst the strengthening dollar. Other currency movements include a recovery in the Australian dollar as tensions ease, GBP/JPY ending its losing streak, and USD/JPY rising during a market lull.
Information on the best Forex Brokers in 2025 outlines low spreads and broker recommendations for various currency pairs, including options for Islamic accounts.
Trading carries risks, necessitating comprehensive research before investing. The views in the article reflect the authors’ perspectives and are not intended as investment advice.
Market Volatility Opportunity
With last Friday’s tariff fears easing, the immediate opportunity is in the calming of market volatility. The VIX, which briefly jumped over 20 on the trade war scare, has already settled back toward the 17 level, making it a good environment to consider selling premium. This could involve strategies like writing covered calls on existing tech holdings to generate income as the market recovers.
We believe the de-escalation is driven by economic necessity, as bilateral trade between the US and China hit a record $795 billion for the twelve months ending August 2025. This deep interdependence makes a prolonged conflict damaging, suggesting this dip was a buying opportunity rather than the start of a new bear market. For now, this reduces the need for expensive, long-dated protective put options on broad indices.
The Broadcom and OpenAI deal reminds us that the artificial intelligence race remains the market’s most powerful theme. The AI hardware sector has already seen over 40% growth year-to-date in 2025, and this news will likely fuel further upside in semiconductor and related technology names. Traders could look at buying short-dated call options on tech-heavy ETFs to capitalize on this renewed momentum.
This pattern of sharp drops on trade threats followed by quick recoveries is something we saw repeatedly during the trade disputes of the late 2010s. History suggests these relief rallies can be strong but also that sentiment remains fragile. Using defined-risk strategies, such as bull call spreads, allows for capturing the upside while protecting against another sudden reversal on geopolitical news.
