News

NZD/USD risk reversals hit highest since January 2018 on falling demand for Puts

Risk reversals on NZD/USD, a gauge of calls to puts on the Kiwi, jumped to the highest level since January 2018 on Monday, indicating investors are positioning for further strength in New Zealand’s currency.

One-month risk reversals have risen to -0.475, a level last seen on Jan. 30, 2018. The gauge stood at -0.825 on July 9.

The negative number indicates the implied volatility premium for put options (bearish bets) on the NZD is higher than that for calls. So, a rise from -0.825 to -0.475 indicates the demand or premium claimed by NZD puts has dropped significantly over the last six days.

As of writing, NZD/USD is trading at 0.6735, having found acceptance above the 200-day moving average of 0.6709 on Monday.

NZD1MRR

Articles You May Like

Action Trade Forex Trading System
ForexLive Americas FX news wrap: China hits back, Trump responds with more tariffs
TFNN LIVE – Stocks and Options Trading News and Education
Why You’ll Never Make Money in Forex Trading (and How to Fix it)
USD/CHF is correcting higher – Commerzbank

Leave a Reply

Your email address will not be published.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