We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Oil - US Crude
Mixed
Bitcoin
Bullish
More View more
Real Time News
  • Currency markets may be battered by breakneck volatility if a slowdown in global economic growth triggers a collapse in the fragile market for collateralized loan obligations (CLOs). Get your market update from @ZabelinDimitri here:https://t.co/KfjjtaXs7b https://t.co/sWeSlv33pb
  • The #Dow Jones and #Nasdaq 100 will await key earnings from some of the world’s largest manufacturers and tech companies while the #DAX grapples with freshly-imposed tariffs. Get your equities market update from @PeterHanksFX Here: https://t.co/u2lG19JFt3 https://t.co/OHs4rQEH7T
  • Crude #oil prices are consolidating above a key support zone we’ve been tracking for more-than three months now. Get your market update from @MBForex here: https://t.co/XaACvEpLG4 #OOTT https://t.co/XjmjUt4Par
  • Why trade with Bollinger Bands®? Find out as a day trader, how you can use it to your advantage:https://t.co/dwODDDSsFi @WVenketas https://t.co/SYduJ5k9mL
  • As the global economy continues to contract, the risk of geopolitical threats undermining financial and economic stability are rising, leaving the door open to violent volatility. Get your market update from @ZabelinDimitri here:https://t.co/2HEzqPobvA https://t.co/k13SwJmbRm
  • RT @IGSquawk: We're currently pricing #GBPUSD at 1.2852 and #FTSE at 7129.2 That's a drop of 1.18% from Fridays close for GBPUSD and 0.22%…
  • #DidYouKnow a #Doji candlestick signals market indecision and the potential for a change in direction. What are the top five types of Doji candlesticks? Find out: https://t.co/c51s3IBcEu https://t.co/K6W9X4v8XD
  • The $NZD may be carving out a near-term bottom against its US counterpart but scope for gains seems limited within a broader downtrend. Get your technical analysis from @IlyaSpivak here: https://t.co/7bsVuSyWMn https://t.co/DsmNYKk8v3
  • Can you trade with the joy of missing out (#JOMO)? Find out how you can turn your #FOMOintrading to JOMO here: https://t.co/G5H26NXZQe https://t.co/pVdKUPzvmk
  • RT @PaulBrandITV: It’s likely that this will end up in court on Monday. The case in the Scottish courts may well consider that this doesn’t…
Currency Volatility: GBPUSD Volatility Surges Amid Emergency EU Summit

Currency Volatility: GBPUSD Volatility Surges Amid Emergency EU Summit

2019-04-10 09:50:00
Justin McQueen, Analyst
Share:

Currency VolatilityGBPUSD and EURUSD Talking Points

  • GBPUSD Volatility Surges, Brexit Extension to be Announced
  • EURUSD Risk Reversals Flip to Positive, Suggesting Near Term Bottom

Top 10 most volatile currency pairs and how to trade them

1D Implied Volatility

Currency Volatility: GBPUSD Volatility Surges Amid Emergency EU Summit

Source: Thomson Reuters, DailyFX

Take a look at our Brexit Timeline to see how negotiations have impacted the markets.

GBPUSD: With eyes on the emergency EU summit, in which it is likely that a Brexit extension will be announced, 1D implied volatility have jumped 7.4 vols to 17.45, as such, the daily implied move is at 96pips. Alongside this, while risk reversals continue to show a premium for downside protection in GBPUSD this has eased in recent sessions as markets continue to price out the likelihood of a no-deal. However, with that said, given that speculative positioning in GBP is somewhat neutral, there may be little to suggest that a short squeeze will fuel a sizeable rally in GBPUSD on a Brexit extension announcement. Elsewhere, retail traders via IG retail positioning remain heavily net long on GBPUSD at 73.9%, which in turn has provided a stronger bearish contrarian bias.

Option Expiries: 1.2990-1.3005 (1.6bln), 1.3130 (400mln)

EURUSD: Yesterday’s report notes that ahead of ECB meeting, EURUSD volatility is at the highest since the last ECB meeting, with an implied daily move of 49pips. Although, which is also important to note is that while 1D volatility has jumped, on a weekly basis they remain subdued, suggesting that the recent range is intact. Alongside this, 1D and 1W risk reversals have flipped to positive, meaning that there is a higher premium for EURUSD call options over puts, potentially suggesting that EURUSD may have bottomed in the near term at 1.1175-85, unless the ECB provides fresh dovish signals. However, this is unlikely to be the case with the ECB likely to await further clarity on whether there could be a rebound in data throughout Q2.

Option Expiries: 1.1200 (700mln), 1.1225 (509mln), 1.1245-50 (1.3bln), 1.1260-75 (2bln)

Currency Volatility: GBPUSD Volatility Surges Amid Emergency EU Summit

Source: Thomson Reuters, DailyFX

WEEKLY CURRENCY VOLATILITY REPORT

For a more in-depth analysis on FX, check out the Q2 FX Forecast

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.