News

Video: A look at implied volatility in the week ahead and euro crosses

Chris Weston from Pepperstone breaks down the euro and the week ahead

I have put a detailed
video together, firstly reviewing market moves this week, with a specific focus
on last night’s ECB meeting and the impact on the EUR crosses. But also the
week ahead and the event risk through which you, as traders, will have to
navigate.

Of course, the key
event will be the FOMC meeting, and I touch on that in greater depth, but there
are other key data points and macro thematic we need to be aware of. I also take
a look at a number of key setups that have come across my radar.

I’ll update these key
trading variables early in the week, but 1-week implied volatility does take into
account the FOMC meeting, so I don’t think it is certainly relevant. Using this
volatility, we can assess the expected move (up or down), which can define our
risk and position sizing. 

In this section I have
looked at the current Commitment of Traders report, options skew (the
difference between 25 delta put and call volatility) and rates expectations.
All of these off insights into our risk-to-reward profile. 

What's priced in 

ForexLive

Leave a Reply

Your email address will not be published. Required fields are marked *