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Daily Archives: April 24th, 2013

Update on EURUSD and Trade 2 month call option

The Euro has trended downwards rather nicely.  The current spot of 1.2990 brings to our attention and interesting opportunity.

The lows was established on 13 November 2012 at 1.2698 and again in 2013 on 27 March 2013 t 1.2749.  The high being 1.3709 established on 1 February 2013.

The current spot has not yet retraced the 50% 1.3173 from the November’s lows and barely retracing the 38.2% level of 1.3059, the chart below shows the sensitivity: –

EURUSD with fibronacci taking low of 1.2698 of 13 Nov 2012

And, it’s further away from the 38.2% of 1.3110 and 50% retracement of 1.3212 from the lows of 27 March: –

 

EURUSD with fibronacci taking low of 1.2749_1 feb 2013

The 1 month call option strike at 1.2990 is 132bps or BE of 1.3123 and the 2 month call option is 184bps and BE of 1.3175.  It appears that the 2 month option is more economical and also buys us more time to allow the Euro to recover and build up some steam.

We have executed the 2 month call option: – EURUSD, strike 1.2990, BE 1.3175, expiring 21 June 2013.