EUR/USD: options markets signal protection to the downside

CME Group’s flash data for the 6EU7 contract with expiration date on August 4 showed OTM (‘out of the money’) Puts increasing by 1,443 contracts, mainly in the 1.1400 strike price and seconded by 1.1450 and on a lesser degree 1.1500. On the opposite side, ITM (‘in the money’) Puts decreased by 386 contracts, largely in the 1.1600 strike price.

In addition, OTM Calls rose by 94 contracts, with the bulk of activity in the 1.1650 strike price, while ITM Calls decreased by 122 contracts.

The Put/Call ratio ticked higher to 1.02.

EUR/USD stays bullish, with focus on 1.15 and the ECB

EUR/USD continues its march south, as hinted yesterday by the increase of more than 900 contracts in ITM Puts at the 1.1600 strike price.

In view of the recent activity in the options markets, traders continued to seek protection from an occasional drop in spot following today’s ECB event, which is eventually a bullish sign.