OPTION VOLATILITIES
The latest round of economic data out of the US has caused the US dollar to tumble on the belief that the Federal Reserve may not raise rates this Tuesday, at its next scheduled FOMC meeting. Fridays job report showed an increase in Non Farm Payrolls of 113,000 jobs for the month of July, much lower than the markets expectations of 143,000. The Unemployment rate rose from 4.6% to 4.8%.
Oil prices are high today following an announcement from BP saying that it will be closing down its Prudhoe Bay oil field in Alaska after corrosion and a small leak were found on the pipeline. The oil field provides the US with 8% of its daily production. This, coupled with kidnappings of oil workers in Nigeria and comments out of Iran threatening action in oil production if they are sanctioned by the UN for their nuclear activities has sent oil prices higher. Tensions in the Middle East continue to rise with the UN security council meeting today to discuss a proposed cease fire by the US and France.
Volatilities are a touch higher this week ahead of the FOMC meeting.
OPTION TRADE IDEAS
Below please find some strategies, which depending on your view might be applicable. Please bear in mind that all of these trades can be applied to any of the currency pairs, which may be traded. All barrier levels, strikes, triggers, payouts, and maturity dates can be tailored to each individuals views.
View: The USD/CHF will continue its recent decline
Trade: Purchase a 1 week USD/CHF Digital Put Option
View: EUR/JPY will decline over the next week
Trade: Purchase a 1 week EUR/JPY One Touch Option
View: The EUR/USD has made its move and will stabilize this week
Trade: Purchase a 1 week EUR/USD No Touch Option
View: NZD/USD will move markedly in one direction but Im not sure which way.
Trade: Purchase a 1 week NZD/USD Double One Touch
For further details, please contact the options dealing desk at 1.212.897.7660 or toll free at 1.888.50.FOREX.
