User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Saturday October 30, 2010 - 00:04:43 GMT
Reuters -

Share This Story:
| | Email

FOREX NEWS - U.S. dollar falls vs yen; FX options flag QE worry

4:54pm EDT

* FX options market flag anxiety

* IMM specs further thin dollar shorts

* Focus remains FOMC and likely monetary easing (Adds quotes, IMM data, updates prices)

By Gertrude Chavez-Dreyfuss

NEW YORK, Oct 29 (Reuters) - Uncertainty over a fresh round of U.S. monetary easing weighed on the dollar on Friday, prompting investors in the options market to hedge against any volatility arising from the Federal Reserve decision.

The dollar fell against the yen and was just shy of a 15-year low hit on Monday, with lackluster U.S. gross domestic product data failing to shake expectations of further stimulus for the economy from the Fed. Quantitative easing is viewed as negative for the greenback as it increases the supply of dollars, diminishing its value. For an economy wrapup, click on [ID:nN28207235].

In late afternoon trading, the dollar was down 0.6 percent at 80.42 yen, on track for its lowest close on record, according to Reuters data.

At the same time, signals emanating from the currency options market on Friday are flagging concern about next week's events, which also include U.S. elections and a non-farm payrolls report for October.

"There's a little anxiety in the market, and this may be about quantitative easing," said Simon Smollett, senior currency options strategist, at Credit Agricole in London.

"This may also be about the fact that most currencies have been overbought against the dollar. There is a whole load of factors here, and the bottom line is that the 'risk off' hedging behavior has crept back into the market even if the price action in spot has been relatively modest."

One important gauge showing increased worry is the euro/dollar risk reversal, a barometer of currency sentiment, which is indicating a decline in the curve or a growing bearish view on the currency pair.

The euro this past year has become a proxy for risk appetite in the developed world, rising when there is increased risk-taking in the market and falling when investors become averse to risk.

The single currency's "put" bias has deepened. On Friday, puts are being traded at a mid-market of -0.925 volEUR1MRR=GFI, according to GFI data, with bids at -1.30. This was a steep drop from bids of -0.55 vol on October 14.

"There is clearly an interest to buy the downside in euro/dollar. The market seems to be warning of a move lower in spot (price of the euro)," Smollet said.

Euro gains so far this month have slowed to around 2 percent from a steep 7.5 percent rise in September. On the week, the euro was down 0.3 percent, its worst weekly performance since mid-September.

This week's decline in the euro versus the dollar is consistent with the pullback in U.S. dollar shorts to $23 billion in the week ended Oct. 26. The euro, sterling, and yen all saw small declines in the extent of their net long positioning against the dollar, while the Swiss franc saw a small increase. See report [IMM/FX].


The options market has also been increasingly wary of the Australian dollar, the euro versus the yen, and Korean won, currencies that thrive in global expansions and rising equity and commodity markets. Their risk reversals have shown an increasing put bias as well.

Implied volatility, another market sentiment gauge, has also spiked in recent sessions. One-week euro/dollar vols have gained over 4 vols the last couple of days to hit the 17.0 handle on Friday although one-month vols remained confined in the upper-13 range.

Sone analysts suggest nervousness about quantitative easing seemed misplaced since most believe the Federal Reserve will err on the side of caution and announce next week a figure that is more in line with market expectations. According to a Reuters poll, most leading economists expect the Fed to buy between $80-$100 billion worth of assets per month. [ID:nNLLRLE6LL].

"The FOMC might end up with a QE3 and a QE4 if the economy really sours, but it can't reasonably announce much more than a half-trillion for QE2 at this point," said Avery Shenfeld, chief economist at CIBC World Markets in Toronto.

"Expectations for more than a trillion in one fell swoop have rightly dwindled, so we don't see much of a market shock from the coming week's Fed announcement."

But congressional elections on Tuesday could have implications for fiscal policy, and Shenfeld thinks the market could well focus on this vote instead of the Fed.

Betting websites suggested that Republicans have a 90 percent chance of taking the House of Representatives. A Republican victory should be positive for the dollar, Westpac senior currency strategist Richard Franulovich said.

The Republicans, he said, have been campaigning on a platform of fiscal prudence and this is a "confidence-building event" for the dollar because it undermines the long-run bearish arguments against the greenback with respect to structural imbalances. (Additional reporting by Nick Olivari; Editing by Kenneth Barry)

© Thomson Reuters 2010. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.

Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.



Forex Trading News

Forex Research

Daily Forex Market News
Forex news reports can be found on the forex research headlines page below. Here you will find real-time forex market news reports provided by respected contributors of currency trading information. Daily forex market news, weekly forex research and monthly forex news features can be found here.

Forex News
Real-time forex market news reports and features providing other currency trading information can be accessed by clicking on any of the headlines below. At the top of the forex blog page you will find the latest forex trading information. Scroll down the page if you are looking for less recent currency trading information. Scroll to the bottom of fx blog headlines and click on the link for past reports on forex. Currency world news reports from previous years can be found on the left sidebar under "FX Archives."

Actionable trading levels delivered to YOUR charts in real-time.

Register To Test Your Amazing Trader

GVI Trading. Potential Price Risk Scale
AA: Major, A: High, B: Medium

Tue 31 July 2018
AA JP- Bank of Japan
A 06:00 DE- Retail Sales
A 09:00 EZ- flash HICP/GDP
AA 12:30 US- Core PCE Deflator
A 14:00 US- CB Consumer Confidence
Wed 1 Aug 2018
A Final Mfg PMIs
AA 12:15 US- ADP Private Payrolls
A 15:00 US- EIA Crude
AA 18:00 US- Federal Reserve Decision
Thu 2 Aug 2018
AA 11:00 GB- Bank of England Decision
A 13:30 US- Weekly Jobless
Fri 3 Aug 2018
A Final Services PMIs
AA 12:30 US- Employment
A 12:30 US/CA- Trade

John M. Bland, MBA
co-founding Partner,

Global-View Affiliate Program

We are starting an affiliate program to market some of our products.

Send me an email if you would be interested or if you know someone who would like to be an affiliate. Generous commissions payout for those accepted.

Put the word "affiliate" in the email subject line.

Contact us

Start trading with forex broker Markets Cube

Max McKegg's Daily Forex Trading Forecasts

Veteran FX Trader, Max McKegg, forecasts all the Major currencies and the Australasians; providing Daily and Medium Term Trading forecasts to subscribers, who include large Banks the world over, as well as individual traders in more than 30 different countries.

Request a TRIAL of Max's Forex Service.


Retail Forex Brokerage Changing!

Are you looking for your first broker or do you need of a new one? There are more critical things to consider than you might have thought.

We were trading long before there were online brokers. Global-View has been directly involved with the industry since its infancy. We've seen everything and are up-to-data with recent regulatory changes.

Our Best Brokers listing section includes:Forex Broker Reviews, Forex Broker Directory, Forex Broker Comparisons and advice on How to Choose a Forex Broker

If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.

SEE Our Best Brokers List

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools

Terms of Use    Disclaimer    Privacy Policy    Contact    Site Map

Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Open Forum
Futures Forum
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Online Forex Trading
Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
Forex Products
GVI Forex
Free Trials
FX Bookstore
FX Jobs and Careers
Jobs USA
Jobs UK
Jobs Canada

Forex Forum

The Global-View Forex Forum is the hub for currency trading on the web. Founded in 1996, it was the original forex forum and is still the place where forex traders around the globe come 24/7 looking for currency trading ideas, breaking forex news, fx trading rumors, fx flows and more. This is where you can find a full suite of forex trading tools, including a complete fx database, forex chart points, live currency rates, and live fx charts. In addition, there is a forex brokers directory where you can compare forex brokers. There is also a forex brokers hotline where you can ask for help choosing a forex broker that meets your individual fx trading needs. Interact on the same venue to discuss forex trading.

Forex News

The forex forum is where traders come to discuss the forex market. It is one of the few places where forex traders of all levels of experience, from novice to professionals, interact on the same venue to discuss forex trading. There is also the GVI Forex, which is a private subscription service where professional and experienced currency traders meet in a private forex forum. it is like a virtual forex trading room. This is open to forex traders of all levels of experience to view but only experienced currency tradingprofessionals can post.

Currency Trading

Currency trading charts are updated daily using the forex trading ranges posted in the Global-View forex database. You will also find technical indicators on the fx trading charts, e.g. moving averages for currencies such as the EURUSD. This is another forex trading tool provided by

Forex Brokers

The forex database can be used to access high, low, close daily forex ranges for key currency pairs, such as the EURUSD, USDJPY, USDCHF, GBPUSD, USDCAD, AUD, NZD and major crosses, including EURJPY, EURGBP, EURCHF, GBPJPY, GBPCHF and CHFJPY. Data for these currency trading pairs dating back to January 1, 1999 can be downloaded to an Excel spreadsheet.

Forex Trading

Forex chart points are in a currency trading table that includes; latest fx tradinghigh-low-close range, Bollinger Bands, Fibonacci retracement levels, daily forex pivot points support and resistance levels, average daily forex range, MACD for the different currency trading pairs. You can look on the forex forum for updates when one of the fx trading tools is updated.

FX Trading

Global-View also offers a full fx trading chart gallery that includes fx pairs, such as the EURUSD, commodities, stocks and bonds. In a fx trading world where markets are integrated, the chart gallery is a valuable trading tool. Look for updates on the Forex Forum when the chart gallery is updated.

Forex Blog also offers a forex blog, where articles of interest for currency trading are posted throughout the day. The forex blog articles come from outside sources, including forex brokers research as well as from the professionals at This forex blog includes the Daily Forex View, Market Chatter and technical forex blog updates. In additional to its real time forex forum, there are also Member Forums available for more in depth forex trading discussions.



By using this website, you are agreeing to our Privacy Policy and Terms of Use, and Cookie Policy

Copyright ©1996-2014 Global-View. All Rights Reserved.
Hosting and Development by Blue 105