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Oct 17 - 06:12 AM
EUR/USD - Gains To Remain A Grind - According To Options
First appeared on eFXplus on Oct 17 - 04:05 AM
  • EUR/USD options have been leaning toward a firmer spot for some time

  • However, they saw a peak by 1.1100, certainly pre ECB/FED nL2N26U05H

  • Risk reversals have edged higher for EUR calls - now 0.25 in 1-month

  • 0.25 is the implied vol premium charged for the right to buy vs sell EUR/USD

  • Clearly shows growing upside risk, but one must look at implied vols too

  • They remain at the low end of long term range and lack any real demand

  • Suggests that any further EUR/USD gains are expected to remain a grind

  • Related comments nL2N26T05SnL2N26Z04K



EURUSD implied vol: Click here

eurusd risk reversals: Click here

Source:
Refinitiv IFR Research/Market Commentary

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