Options activity: Investors seek downside protection in AUD
|The AUD/USD pair is trading in the sideways manner around 0.79 handle after having hit a high of 0.7988 on July 20. The overbought conditions and the indecision in the market as indicated by July 20 Doji candle has forced investors to seek downside protection against long spot positions.
ADUQ7 Open Interest Change: Current (Jul 25 - Prelim) vs. Jul 24
| Call Summary | |||||
| Total | ITM | OTM | |||
| OI | Chg | OI | Chg | OI | Chg |
| 10,082 | -62 | 8,423 | -92 | 1,659 | 30 |
| Put Summary | |||||
| Total | ITM | OTM | |||
| OI | Chg | OI | Chg | OI | Chg |
| 14,259 | 1,115 | 372 | 66 | 13,887 | 1,049 |
The big jump in the OI in the put options, coupled with the net reductions in the OI in the call options clearly highlights the fact that the idea of a pullback is gathering traction. The OI in the 0.7850 put option jumped by 823 contracts. 0.79 Put added 112 contracts.
The spot could test 0.7829 (38.2% Fib R of July 7 low - July 20 high) - 0.78 levels in the short-term. The overbought technical conditions and the jump in the Put options OI gels well with the RBA’s jawboning effort.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.