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Spot Rally Narrows Gap With Sizeable Options Interest Through the Week

AUD
  • AUD extending outperformance 30 mins into the cash session, with the pair convincingly clearing $0.6735 (as well as $0.6691, the former bull trigger) to print the best levels since late July. The moves further narrow the gap with the next upside level of 0.6821, the Jul 27 high.
  • Options markets moving in sympathy with spot so far Tuesday, prompting AUD/USD 1m risk reversals to edge to just 0.4 points in favour of puts, the small put premium since mid-2020.
  • AUD gains put spot within range of some of the more sizeable expiries rolling off later this week: Dec20 $0.6790-00(A$1.5bln), Dec21 $0.6800-15 A$1.3bln, Dec22 $0.6775(A$1.1bln).

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