EUR/USD: Options market turns most bullish in a week ahead of ECB, US GDP

Anil Panchal FXStreet

One-month risk reversal (RR) of the EUR/USD, a gauge of calls to puts, prints +0.050 readings for Wednesday, per the latest data from Reuters.

The figures suggest that the pair traders are the most bullish since October 19 when the RR marked +0.0932 level. It’s worth noting that the positive RR level also consolidates the previous day’s negative prints of -0.063.

However, the EUR/USD pair’s latest price action refrains from portraying the bullish bias, down 0.06% intraday around 1.1600.

The quote’s latest moves could be linked to the US Dollar’s pick-up tracking the US Treasury yields. The US 10-year Treasury yields gain two basis points (bps) to regain 1.55% after dropping the most since mid-August the previous day. The consolidation of the US Treasury yields portrays the market’s rush for risk-safety ahead of the preliminary US Q3 GDP and monetary policy meeting of the European Central Bank (ECB).

The US Q3 GDP is expected to have eased from 6.7% to 2.7% during the preliminary forecast, which in turn may allow the Fed to take some time before announcing the details for tapering.

Read: US Third Quarter GDP Preview: A most uncertain estimate

On the contrary, the ECB is likely to portray a hawkish play but there are reasons for the Euro (EUR) bulls to consider before eyeing the EUR/USD run-up.

Read: European Central Bank Preview: Finally, some action, but no hopes for the EUR

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

EUR/USD holds firm near 1.1850 amid USD weakness

EUR/USD remains strongly bid around 1.1850 in European trading on Monday. The USD/JPY slide-led broad US Dollar weakness helps the pair build on Friday's recovery ahead of the Eurozone Sentix Investor Confidence data for February.

GBP/USD hovers near 1.3600 as UK government crisis weighs on Pound Sterling

GBP/USD moves sideways after registering modest gains in the previous session, trading around 1.3610 during the European hours on Monday. The pair could come under pressure as the Pound Sterling may weaken amid a fresh government crisis in the United Kingdom.

Gold remains supported by China's buying and USD weakness as traders eye US data

Gold struggles to capitalize on its intraday move up and remains below the $5,100 mark heading into the European session amid mixed cues. Data released over the weekend showed that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Fed expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Cardano steadies as whale selling caps recovery

Cardano (ADA) steadies at $0.27 at the time of writing on Monday after slipping more than 5% in the previous week. On-chain data indicate a bearish trend, with certain whales offloading ADA. However, the technical outlook suggests bearish momentum is weakening, raising the possibility of a short-term relief rebound if buying interest picks up.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.