DailyFX Forex Options Weekly: Is this the US Dollar Turn We've Waited For?
A sharp correction in FX Options sentiment suggests that the recent US Dollar rally may be the start of the long-awaited correction, and our benchmark risk reversals trading systems have accordingly closed their USD-short positions.

We have admittedly been caught on the wrong side of US Dollar forecasts on several occasions at this point, but it is difficult to argue with the speed with which FX Options traders have begun to bet on and hedge against further US Dollar strength. This is especially true against the Euro, which has fallen over 500 pips against the US Dollar in less than a week. Given previously one-sided positioning and sentiment, the USD could rally further as speculators cover their short positions in a hurry.

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