Insights 
VT 
Commodities Market Update
In the commodities market, crude oil is trading bullish at the European opening. The Australian Dollar holds its gains as the American Dollar remains subdued.
The EUR/USD has shown some recovery, reaching near 1.1650. Amidst a prolonged US government shutdown, the Dollar struggles while the Fed chair is set to deliver a speech.
In recent trading, Gold reversed a dip, reaching close to the $4,000 mark. Furthermore, Monero continued its gains, aiming for a four-month peak.
The current US economic outlook remains uncertain due to a federal government shutdown. As of early October 2025, the reopening date for the government remains unclear.
Various brokerage options are available for traders in 2025. These include options based on low spreads, high leverage, and regions such as the Middle East and Latin America.
US Government Shutdown Impact
The ongoing US government shutdown, now in its ninth day, is the primary driver of market sentiment and is weakening the US Dollar. We have seen this pattern before, particularly during the 35-day shutdown in 2018-2019, which also led to a significant drop in the dollar index. Traders should anticipate continued short-term pressure on the dollar as long as Washington remains at an impasse.
Market positioning is heavily betting on two more Federal Reserve rate cuts this year, a belief that has pushed gold towards the $4,000 mark. This makes today’s speech by Fed Chair Jerome Powell a critical risk event, as any deviation from this dovish expectation could unwind these trades violently. Given this, we should consider options strategies that protect against a sharp reversal in gold and a rebound in the dollar.
While the euro is strengthening, we must acknowledge signs of economic softness in the bloc. The reported decline in Dutch consumer spending is not an isolated event, as recent PMI data from across the Eurozone showed manufacturing activity remains in contractionary territory below the 50.0 mark. This economic weakness may limit the European Central Bank’s policy choices and could cap the EUR/USD pair’s rally as it approaches the 1.1700 level.
In this environment of high uncertainty, derivative traders should focus on volatility. We have seen implied volatility on major currency options, measured by indices like the Deutsche Bank Currency Volatility Index, increase by over 12% in the last two weeks. Buying straddles or strangles on EUR/USD and GBP/USD could prove profitable as they benefit from large price swings in either direction, regardless of the shutdown’s outcome.
For those with a directional bias, using option spreads is a prudent way to manage risk. A trader bullish on the British Pound due to dollar weakness might buy a GBP/USD call spread to reduce the initial premium paid. Conversely, a trader believing the shutdown will end soon could use bear put spreads on gold to capitalize on a potential price correction from its currently elevated levels.
