FxWirePro: US retail business looks healthy - Gamma spreads for AUD/USD’s potential downswings

Fundamental rationale:

US retail sales economic reports:

The US commerce department mentioned that the retail sales increased by 0.6% last month, beating expectations for a gain of 0.5%. Retail sales dropped by 0.3% in June. Core retail sales, which exclude automobile sales, rose by 0.4% in July, matching forecasts.
While unemployment claims were quite poor to increase by 5K from previous print at 269K.

On the flip side, AUD/USD has been in supply when the PBoC came out and instigated what had been expected of them in as much of the poor performances of the economy of late. Australia's NAB business confidence is published with the business confidence for July coming at 4 versus 8.

Prevailing implied volatility rates for AUD/USD is perceived at 13% with current downtrend keeping mind, on a long term hedging perspective, debit gamma put spreads are advocated so as to reduce the sensitivity and focus on hedging motive.

Selling 2W out of the money put option is recommended to reduce the cost of hedging by financing long position in buying 2M in the money Puts as the selling indications are piling up on weekly graph. So, buy 2M (1%) in the money 0.11 gamma put option and short 15D (-1%) out of the money put option for net debit.