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Amid highly volatile economic environment, shielding currency exposure has become too risky than before. In this series we provide an intelligent insights and analysis on actionable FX derivative strategies that serve different levels of risk appetites and returns.

FX Hedging Strategy Series

FxWirePro: EUR/JPY whipsaws on 7DMA, bulls seem exhausted near resistance 127.619 - buy tunnel options on BB

Mar 24, 2016 05:40 am UTC| Technicals

We see the price fluctuation whipsaws 7DMA at 126.05. Short term bulls have given up the momentum in recent gains as the price curve approaches near resistance at 127.619 and upper BB (see yellow colour circled...

FX Hedging Strategy Series

FxWirePro: EUR/CHF diagonal iron butterfly spreads for laggards and debit spreads for dubious bears on lacklustre IVs

Mar 23, 2016 12:29 pm UTC| Technicals

The implied volatilities of ATM contracts are just shy above 7% for next 3 months tenors, whereas risk reversals have been bearish neutral. So if anyone believes it can still be possible to pull out returns from this...

FX Hedging Strategy Series

FxWirePro: USD/CAD IVs to shrink (1M-6M) - Why do put ladders seem better over put ratio spreads?

Mar 23, 2016 11:28 am UTC| Technicals

The implied volatility of USDCAD has been bullish neutral for 3M expiries among G7 currency segment contemplating risk reversal signals. At spot ref: 1.3074, go long in 2M USD/CAD put ladder (strikes...

FX Hedging Strategy Series

FxWirePro: USD/CAD shooting star evidences dips - bears on verge of breaking out channel support - speculate via option tunnels

Mar 23, 2016 10:55 am UTC| Technicals

On daily chart, although the prices are trying bounce from last 3-4 days, now remained well below 7 21DMA. Current prices are testing resistance at 7DMA. While breaking channel support, a resembling bearish...

FX Hedging Strategy Series

FxWirePro: US treasury forward vols and gamma seem better for hedging after FOMC

Mar 23, 2016 08:47 am UTC| Technicals

U.S.5Y treasury yield is flashing at 1.41% an increase from previous 1.38%, up about 2.61%. 14-day Real Strength - 55.11% 14-day Stochastic %K - 29.95% 14-day Stochastic %D - 35.61% With 5yT yields down 15bp on...

FX Hedging Strategy Series

FxWirePro: 1W AUDJPY Vega ATM puts on upper hand to expire in-the-money - sensitivity analysis to substantiate

Mar 23, 2016 07:27 am UTC| Technicals

As shown in the diagram, please be noted that the Vega of OTM strikes are at the highest positive levels along with higher vols. The premiums of ATM strikes are trading at around 14.13% more than NPV. We know that...

FX Hedging Strategy Series

FxWirePro: AUD/JPY 1W OTM puts more in sync with sensitivity tools - HY IVs likely to favour delta puts in PRBS

Mar 23, 2016 07:21 am UTC| Technicals

We begin with the reference of put options, hereinafter when we refer OTM or ATM strikes it is deemed as put options with OTM strike prices. Well, the implied volatility of ATM contracts are spiking from 11.65% in 1w...

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Technology

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