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FX options wrap - FX eruption, EUR topside, short gamma, CNH alert

BUZZ-FX options wrap - FX eruption, EUR topside, short gamma, CNH alert Mild USD recovery/consolidation takes front-end expiry FX option implied volatility off its most recent highs. However, setbacks are proving limited amid the strong demand and high premiums attached to post NFP options - reflecting the importance of this event to the scale of the September 18 U.S.
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FX options wrap - Signs of fatigue before next major events

BUZZ-FX options wrap - Signs of fatigue before next major events Aug 28 (Reuters) - FX option implied volatility increased beside USD put premiums as the USD fell more broadly in mid-late August, but renewed supply now recognises the many stretched G10 FX positions and current spot consolidation. There's little to excite markets before next week's U.S.
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FX options wrap - Positioning for a weaker USD

BUZZ-FX options wrap - Positioning for a weaker USD FX options have been positioning for a weaker USD as expectations of Fed easing gathered pace and some currency pairs appear more fearful than others about an extended USD decline. A UK holiday dampened incentive and trade flows on Monday, but there has been demand and increased volatility premium for options including impending NFP data after Fed chair Powell's comments on Friday .
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Stand-out FX option strike expiries this week

BUZZ-COMMENT-Stand-out FX option strike expiries this week Aug 26 (Reuters) - The cash hedging of soon-to-expire FX option strikes can have a magnetic effect on FX price action, adding to nearby support/resistance. There are some large strikes on Monday and plenty more for the week ahead. The biggest EUR/USD strikes expiring this week are on Tuesday at 1.1100-10 on 1.8 billion euros and 1.1150 on 1.3 billion euros.
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FX options wrap - FX volatility risk gone but not forgotten

BUZZ-FX options wrap - FX volatility risk gone but not forgotten The substantial increase in implied volatility triggered by the risk aversion following the July NFP data has largely been reversed. However, FX volatility risk premiums are beginning to attract demand as the majority approach their longer term lows from June. Markets have re-embraced the U.S.
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Stand-out FX option strike expiries for the week ahead

BUZZ-COMMENT-Stand-out FX option strike expiries for the week ahead Aug 16 (Reuters) - The cash hedging of soon-to-expire FX option strikes can have a magnetic effect on FX price action, adding to nearby support/resistance. There are some huge strikes on Friday and plenty more for the week ahead. Standout EUR/USD strikes are on Monday at 1.1000-10 on 1.2 billion euros.
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Australian dollar sets for strong weekly gain, kiwi lags

Australian dollar sets for strong weekly gain, kiwi lags SYDNEY, Aug 16 (Reuters) - The Australian dollar was set for a strong weekly gain on Friday, buoyed by hawkish expectations for domestic interest rates, while the kiwi ended the week barely up as markets wagered on a string of rate cuts over the coming months. The Aussie AUD=D3 climbed another 0.2% to $0.6624, nearing a three-week top of $0.6643. It bounced 0.2% overnight to crack resistance at a major chart level of 66 cents.
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FX options wrap - FX volatility risk measures take a hit

BUZZ-FX options wrap - FX volatility risk measures take a hit Aug 15 (Reuters) - FX option implied volatility spiked to new long term highs on Aug. 5, as risk was hit and carry trades unwound on the back of U.S. recession fears. However, shorter dated and front end expiry implied volatility has fully reverted as those fears are put to rest, for now .
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FX options wrap - Risk premium, USD direction, EUR/USD targets

BUZZ-FX options wrap - Risk premium, USD direction, EUR/USD targets Overnight expiry FX option implied volatility in the higher beta USD pairings was trading its biggest pre-U.S. CPI premium this year. However, Wednesday's data was basically in line with expectations and didn't prompt the excessive volatility for which options were primed. Broader FX option implied volatility has eased as the CPI risk premium was priced out and as always, is more evident in sub-one-month expiry contracts.
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Dollar sags after benign US inflation data; kiwi skids on rate cut

FOREX-Dollar sags after benign US inflation data; kiwi skids on rate cut Updates prices as of 0315 GMT By Kevin Buckland TOKYO, Aug 14 (Reuters) - The dollar remained on the back foot on Wednesday after tumbling versus major peers overnight as a benign reading for U.S. producer prices reinforced bets on Federal Reserve interest rate cuts this year.
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RBNZ risks lean in favour of a pause

BUZZ-COMMENT-RBNZ risks lean in favour of a pause Aug 13 (Reuters) - The RBNZ policy decision on Wednesday is shaping up to be one of the more exciting of recent times. The market is currently pricing a 75% chance of a 25bps rate cut, in contrast to the 61% of economists polled by Reuters who expect the official cash rate to be left unchanged at 5.5%.
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Stand-out FX option strike expiries for the week ahead

RPT-BUZZ-COMMENT-Stand-out FX option strike expiries for the week ahead Repeats with no changes Aug 9 (Reuters) - The cash hedging of soon-to-expire FX option strikes can have a magnetic effect on FX price action and add to nearby support/resistance. There are some large strikes worth noting for the week ahead. EUR/USD strikes expire on Monday at 1.0900 on 1.3 billion euros ($1.42 billion) and Tuesday at 1.0865-75 on 1.4 billion euros and 1.0900 on 1.7 billion euros.
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Stand-out FX option strike expiries for the week ahead

RPT-BUZZ-COMMENT-Stand-out FX option strike expiries for the week ahead Repeats with no changes Aug 9 (Reuters) - The cash hedging of soon-to-expire FX option strikes can have a magnetic effect on FX price action and add to nearby support/resistance. There are some large strikes worth noting for the week ahead. EUR/USD strikes expire on Monday at 1.0900 on 1.3 billion euros ($1.42 billion) and Tuesday at 1.0865-75 on 1.4 billion euros and 1.0900 on 1.7 billion euros.
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FX options wrap - Adjusting for calm before possible data storm

BUZZ-FX options wrap - Adjusting for calm before possible data storm There have been some significant changes in FX option premiums over recent sessions amid the strong shifts in risk appetite and unwinding of carry trades. Implied volatility spiked to new longer-term highs across the board on Monday and despite the subsequent setbacks, it remains above prior levels.
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Stand-out FX option strike expiries for the week ahead

BUZZ-COMMENT-Stand-out FX option strike expiries for the week ahead Aug 9 (Reuters) - The cash hedging of soon-to-expire FX option strikes can have a magnetic effect on FX price action and add to nearby support/resistance. There are some large strikes worth noting for Friday Aug. 9 , and for the week ahead. EUR/USD strikes expire on Monday at 1.0900 on 1.3 billion euros ($1.42 billion) and Tuesday at 1.0865-75 on 1.4 billion euros and 1.0900 on 1.7 billion euros.
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Australia dlr climbs on kiwi as market bays for NZ rate cut

Australia dlr climbs on kiwi as market bays for NZ rate cut By Wayne Cole SYDNEY, Aug 8 (Reuters) - The Australian dollar jumped on its New Zealand rival on Thursday as investors ramped up bets for a kiwi rate cut as soon as next week, while pushing out the timing for an easing at home. New Zealand rate markets rallied sharply after the Reserve Bank of New Zealand (RBNZ) reported its survey of inflation expectations had seen the two-year outlook sink to 2.03% for the September quarter, from 2.33
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FX options wrap - Many reactions to shifting FX drivers

BUZZ-FX options wrap - Many reactions to shifting FX drivers Shifting interest rates/expectations are a key driver of FX and volatility and there's certainly been some related movements this week. Weaker than forecast Australian CPI removed any RBA hike probability and put more pressure on AUD. That lifted related implied volatility, with 1-month AUD/USD posting a new recent high at 9.1 before supply returned it to 8.7 as AUD/USD recovered from its lows.
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Australia, NZ dollars off the floor, bonds build big rally

Australia, NZ dollars off the floor, bonds build big rally By Wayne Cole SYDNEY, Aug 1 (Reuters) - The Australian and New Zealand dollars steadied above recent lows on Thursday as a sharp fall in U.S. yields sparked a round of short-covering in the beaten-down currencies, while bonds extended gains on hopes of early rate cuts. The Aussie held at $0.6540 AUD=D3 , having bounced from a three-month low of $0.6480 overnight.
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FX options wrap - JPY explosion, GBP hedges, Fed preview

BUZZ-FX options wrap - JPY explosion, GBP hedges, Fed preview JPY related options exploded higher with JPY in the wake of Wednesday's BoJ tightening. Gamma demand at the fore with 1-week USD/JPY implied volatility reaching 16.25 and 1-month 11.5 - new highs since April 29. Subsequent setbacks were limited in anticipation of the eventual 150.00 barrier break that was being hedged since last week .
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FX options wrap - BoJ fear gauge, AUD setback risk, FX hedging

BUZZ-FX options wrap - BoJ fear gauge, AUD setback risk, FX hedging Uncertainty surrounding Wednesday's Bank of Japan policy announcement has increased related FX volatility risk premiums, with overnight expiry options trading at year-to-date highs . Overnight-expiry JPY-related implied volatility is trading at its highest levels since the Dec. 19 BoJ announcment and reflects the additional realised FX volatility this event is expected to generate .
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