Free Trial
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
OPTIONS
- Stellar session Tuesday for FX options volumes, with the BoJ and RBA decisions helping underpin activity. Over $110bln notional crossed via the DTCC – making for the busiest session for FX derivatives since February 2nd.
- Unsurprisingly, USD/JPY hedges were front and centre. Clear demand for OTM calls and ITM puts above yesterday’s highs of 150.96 provide clear evidence of topside interest after the post-BoJ rally on Tuesday (see chart below) – a pattern that’s persisted into Wednesday trade, with some of the largest trades comprised of Y153 calls and Y151.50, Y153.50 puts rolling off at the end of April.
- The decline in G10 FX implied vols has steadied – at least in the short-end – with most 1m implied vol contracts edging higher – a pattern that’s consistent out to six month tenors – which capture likely policy pivots from the ECB, Fed and BoE, as well as pre-election political risk across the US and UK.
- More sizeable strikes rolling off today include a series of expiries that could keep EUR/USD rangebound: $1.0800(E1.1bln), $1.0810-25(E2.1bln), $1.0875-80(E1.2bln), $1.0900-10(E2.2bln), while options interest in AUD/USD could come into play on further spot weakness: AUD/USD: $0.6500(A$1.1bln).
Figure 1: Topside interest north of Tuesday high clear in JPY hedging post-BoJ
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
We are facing technical issues, please contact our team.
ok
Your request was sent sucessfully! Our team will contact you soon.
ok