Results for Options
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Where is the Anxiety Ahead European Political Risk on March 4?

February 27, 2018
Among the biggest political risk of the year is at hand.  The results of the SPD vote on whether to join another grand coalition and the national election of Italy are due Sunday.   The market is unusually calm about it.

The euro is trading sideways, a couple cents below the multi-year high set two weeks ago near $1.2550.  Speculators in the fu…
Where is the Anxiety Ahead European Political Risk on March 4? Where is the Anxiety Ahead European Political Risk on March 4? Reviewed by Marc Chandler on February 27, 2018 Rating: 5
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Markets Becalmed Ahead of US data and Weekend

May 12, 2017
The foreign exchange market is becalmed, and the major currencies are little changed. The US dollar is mixed, but mostly a little lower.  
Sterling is the weakest of the majors, off 0.3%, near $1.2850, having been rebuffed by offers in front of $1.30 several times. It has not recovered from the quarterly inflation report and Carney's press conf…
Markets Becalmed Ahead of US data and Weekend Markets Becalmed Ahead of US data and Weekend Reviewed by Marc Chandler on May 12, 2017 Rating: 5
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Great Graphic: Brexit Fears Boost Sterling Put Buying

March 23, 2016
The UK referendum is three months away.   Three-month options are a common benchmark for various market segments; from speculators, to fund managers to corporations.  Events over the past week have raised the risks that the UK votes to leave the EU.
The market has responded forcefully today, and even if you only follow the spot market, what is hap…
Great Graphic: Brexit Fears Boost Sterling Put Buying Great Graphic: Brexit Fears Boost Sterling Put Buying Reviewed by Marc Chandler on March 23, 2016 Rating: 5
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What the Options Market may be saying about the Euro and Yen

November 16, 2015
The latest leg down for the euro began in mid-October when the single currency met a wall of sellers in front of $1.15.  Draghi's dovishness at the press conference following the October 22 ECB meeting sent the euro toward $1.11.  The contrasting hawkishness of the Federal Reserve, where the FOMC statement on October 28 specifically cited the …
What the Options Market may be saying about the Euro and Yen What the Options Market may be saying about the Euro and Yen Reviewed by Marc Chandler on November 16, 2015 Rating: 5
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What the Options Market may be Telling Us about the Yen

November 13, 2013
For the first time since early June, 3-month dollar calls are trading at a premium over puts (25 delta). Calls were trading a shrinking discount since early October, but as only turned positive last week. The latest push took place in a rising vol environment. Three-month implied volatility rose from about 8.5% on October 29 to about 10.3% yeste…
What the Options Market may be Telling Us about the Yen What the Options Market may be Telling Us about the Yen Reviewed by Marc Chandler on November 13, 2013 Rating: 5
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Snapshot of Implied Volatility

August 08, 2013
Investors are not only interested in market direction, but also the speed of the change, or volatility, is important.  It is critical for appreciating and managing risk.  The volatility we look at here is implied, or embedded, in current option prices.  This is different than historical volatility, which is the actual volatility of the underlying…
Snapshot of Implied Volatility Snapshot of Implied Volatility Reviewed by Marc Chandler on August 08, 2013 Rating: 5
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What the Options Market is Telling Us about the Spot Market

March 13, 2013
The options markets may generate insight into the direction of the spot foreign exchange market and what traders may be fearful of. For our purposes here we will look at two measures for the euro, yen and sterling.

The first measure is implied volatility and the second measure is the risk-reversal. Recall that puts and calls struck equidistant …
What the Options Market is Telling Us about the Spot Market What the Options Market is Telling Us about the Spot Market Reviewed by Marc Chandler on March 13, 2013 Rating: 5
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Euro Warnings from the Options Market

July 24, 2012
There are two developments in the options market for euro that one should think about even if one does not trade options.  We have often found that divergences between the spot and options generate important insight into market direction.  
The first development has to do with the pricing of puts and calls equidistant from the money.  These are cal…
Euro Warnings from the Options Market Euro Warnings from the Options Market Reviewed by Marc Chandler on July 24, 2012 Rating: 5
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