EUR/USD continues to experience mild bearish pressure, staying below 1.1600. Market participants await the US House vote on a funding bill to end the government shutdown and look for cues from Federal Reserve policymakers.

GBP/USD regains ground, trading around 1.3130 in the US session. The US Dollar softens as a funding bill to end the government shutdown progresses, with expectations that the largest shutdown in US history will soon conclude.

Gold Continues Its Upward Movement

Gold continues its upward movement, reaching approximately $4,195 early on Thursday. The metal’s rise comes as the US government shutdown nears resolution, opening the path for forthcoming Federal Reserve actions.

Bitwise highlights a forward-looking trend in cryptocurrency, suggesting a return to ICO-inspired capital formation by 2026. This development is set to usher in a new era of financial innovation within the crypto industry.

Optimism regarding the US government situation enhances risk sentiment across European markets. However, the FTSE 100 diverges slightly, experiencing a small decline amid broader gains.

Sui (SUI) is on the rise, crossing the $2.00 threshold after recent fluctuations. This uptick follows a 3.5% increase, recovering from a prior decrease to $1.98 as the cryptocurrency market picks up momentum.

Market Focus and Its Impact

We see the market’s main focus is the expected end of the US government shutdown, which is boosting risk appetite. This optimism is causing the US Dollar to weaken as traders move away from safe havens. Any delay or failure in the House vote would likely reverse this sentiment sharply.

Once the shutdown is resolved, all eyes will turn to the Federal Reserve for guidance on interest rates. Markets are increasingly pricing in rate cuts for early 2026, with current futures data suggesting a greater than 70% probability of a cut by March. This expectation is the primary force driving certain asset classes right now.

Gold’s rally toward $4,200 is a direct result of these rate cut hopes, a dynamic we last saw during the monetary easing cycles of the early 2020s. We believe using call options on gold futures is a viable way to ride this momentum. However, given the historically high price, purchasing protective puts is a prudent hedge against any unexpectedly hawkish Fed commentary.

The EUR/USD is struggling below the key 1.1600 level, showing significant caution ahead of the Fed’s upcoming statements. We think this pair will remain under pressure until the Fed provides clear dovish signals. Traders could consider put options to guard against a scenario where the dollar regains strength.

Conversely, GBP/USD has broken above 1.3100, benefiting almost entirely from the dollar’s decline. We are cautious, as the lagging performance of the FTSE 100 index suggests underlying weakness in the UK economy. This makes the pound’s rally vulnerable if the dollar finds a reason to bounce back.

In cryptocurrency, assets like SUI are rising with the general risk-on mood, recovering to the $2.00 mark. The long-term narrative around a new capital formation cycle in 2026 provides a bullish backdrop for the sector. For now, short-term call options on major crypto assets could be used to trade the positive sentiment stemming from the expected government deal.

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