Delta Profile of USD/INR 19th Jan Expiry Options:
Delta indicates how much the OPTION PRICE can change if USDINR futures move by 1 paise.
For instance:
If USD/INR rises by 1 paise from the current level, the USD/INR 83.1250 call option premium may increase by 0.42 paise, almost 2 ticks.
The idea of sharing the delta profile is to help the scalpers or intra day option traders decide which strike to choose vis-a-vis the change in underlying.
Please take note:
Delta will vary as implied volatility changes, and as the value of USD/INR futures fluctuates, as well as when the time to expiry decreases.
Therefore, while keeping all these factors constant, this is the delta profile for USD/INR options when the 19th Jan futures price is at 83.05
Delta indicates how much the OPTION PRICE can change if USDINR futures move by 1 paise.
For instance:
If USD/INR rises by 1 paise from the current level, the USD/INR 83.1250 call option premium may increase by 0.42 paise, almost 2 ticks.
The idea of sharing the delta profile is to help the scalpers or intra day option traders decide which strike to choose vis-a-vis the change in underlying.
Please take note:
Delta will vary as implied volatility changes, and as the value of USD/INR futures fluctuates, as well as when the time to expiry decreases.
Therefore, while keeping all these factors constant, this is the delta profile for USD/INR options when the 19th Jan futures price is at 83.05
USDINR slowly drifting towards lower end of range @ 82.80/90 levels on spot
Currency Corner by Kotak Securities
USDINR slowly drifting towards lower end of range @ 82.80/90 levels on spot
Finally some buying emerges in USDINR
US CPI y/y +3.4% versus 3.2% expected
Core core CPI 3.9% y/y versus 3.8% y/y expected
US initial jobless claims 202K vs 210K estimate
US Dollar Index is trading flat...
overall USD positive data
Core core CPI 3.9% y/y versus 3.8% y/y expected
US initial jobless claims 202K vs 210K estimate
US Dollar Index is trading flat...
overall USD positive data
Traders are heavily favoring out-of-the-money put options over calls for USDINR, betting it won't sustain below 83.00. The risk lies in a potential drop below this level, posing dangers for those invested in the strategy. Close monitoring and effective risk management are crucial amid market uncertainties.
Forwarded from Currency Corner by Kotak Securities
Today is currency weekly expiry.
Some important points to keep in mind:
1) Contracts expires at 12:30 pm, at RBI (FBIL) reference rate, also known as final settlement price.
2) Cash settled Contracts. Expires like any other other indices (Nifty/Bank Nifty/Sensex).
No delivery on auto-expiry/No penalty if contracts expire ITM.
3) Final settlement price is known by 1:30/1.45 pm, and is made available on exchange website.
The best way to figure out likely final settlement price (RBI reference rate) is weekly futures price. Check for futures contract expiring today.
Normally, we see final settlement price within +/- 0.0050p variation from the weekly futures price trading between 11:30 am to 12:30 pm.
4) In case of options, one tick (0.0025p) covers the cost. Yes...and there is no brokerage charged, if trades are intra-day.
See the link below to understand it better.
https://t.me/CurrencyCornerByKotakSecurities/11751
Happy Trading !!!
Learn, Trade and Grow with Kotak Securities.
Some important points to keep in mind:
1) Contracts expires at 12:30 pm, at RBI (FBIL) reference rate, also known as final settlement price.
2) Cash settled Contracts. Expires like any other other indices (Nifty/Bank Nifty/Sensex).
No delivery on auto-expiry/No penalty if contracts expire ITM.
3) Final settlement price is known by 1:30/1.45 pm, and is made available on exchange website.
The best way to figure out likely final settlement price (RBI reference rate) is weekly futures price. Check for futures contract expiring today.
Normally, we see final settlement price within +/- 0.0050p variation from the weekly futures price trading between 11:30 am to 12:30 pm.
4) In case of options, one tick (0.0025p) covers the cost. Yes...and there is no brokerage charged, if trades are intra-day.
See the link below to understand it better.
https://t.me/CurrencyCornerByKotakSecurities/11751
Happy Trading !!!
Learn, Trade and Grow with Kotak Securities.
USDINR: (Intraday bias- Range bound.
Support Jan futures – 83.00 and 82.85
Resistance- 83.20 and 83.40)
Option writers have significantly increased positions in writing near out-of-the-money (OTM) put options (82.50 to 83.00) versus OTM call options (83.1250 to 83.6250) for USDINR, signalling strong confidence in the currency not sustaining below 83.00. This bet is contingent on a rebound toward 83.35/40 levels, maintaining profitability within the existing range. However, a sudden breakdown may prompt put sellers to hedge with futures, potentially triggering a downside cascade. While current global cues hint at a negative USD trend, the Indian Rupee needs to leverage these factors amid the established 6-month range (82.80/90 to 83.40/45) for successful short straddle and strangle strategies.
GBPINR: (Intraday bias – Range bound.
Support Jan futures- 105.80 and 105.60.
Resistance – 106.30 and 106.50.
After a post-US CPI release dip, both GBPUSD and GBPINR exhibited a rebound. However, initiating fresh long positions in GBPINR at current levels is not recommended. It's prudent to await a pullback towards the 105.60/80 zone before considering new long positions. The overall bias remains upward, contingent on GBPUSD staying above 1.2680. Key support for GBPINR lies at 105.80 and 105.60, with anticipated resistance near 106.30 and 106.50. Traders should vigilantly monitor these levels for informed decision-making in the current market conditions.
EURINR: (Intraday Bias- Upward drift.
Support Jan futures – 91.00 and 90.75,
Resistance – 91.50 and 91.75)
U.S. consumer prices rose 0.3% in December, surpassing expectations, with rents maintaining an upward trend, registering a 3.4% annual increase. Despite this, traders are pricing in a 71% likelihood of a 25-basis point cut in March, expecting a total of 150-175 bps cuts in 2024, as per CME Group's FedWatch Tool. Cleveland Fed President Loretta Mester suggests the recent CPI data might delay a March rate cut. Traders await weaker data and a more optimistic Fed stance; a delay could shift rate cut expectations to May-June, potentially boosting the USD. Meanwhile, EURUSD and EURINR traders can find support in buying dips, with 1.0880/1.0900 as a strong support zone. Vigilance is key as market dynamics unfold.
JPYINR: (Intra-day bias- Range bound.
Support Jan futures- 57.35 and 57.15,
Resistance- 57.75 and 58.00)
USDJPY weakened overnight due to softened US bond yields, resulting in a higher opening for JPYINR. If this downward correction persists next week, USDJPY may decline towards 143.00, providing a potential shorting opportunity for JPY carry traders or JPYINR short traders. A move towards 143.00 could mean JPYINR testing the 58.00/58.20 region. Positional shorts should consider maintaining a stop based on USDJPY below 140.00 or above 59.50/60 levels in JPYINR for risk management.
Support Jan futures – 83.00 and 82.85
Resistance- 83.20 and 83.40)
Option writers have significantly increased positions in writing near out-of-the-money (OTM) put options (82.50 to 83.00) versus OTM call options (83.1250 to 83.6250) for USDINR, signalling strong confidence in the currency not sustaining below 83.00. This bet is contingent on a rebound toward 83.35/40 levels, maintaining profitability within the existing range. However, a sudden breakdown may prompt put sellers to hedge with futures, potentially triggering a downside cascade. While current global cues hint at a negative USD trend, the Indian Rupee needs to leverage these factors amid the established 6-month range (82.80/90 to 83.40/45) for successful short straddle and strangle strategies.
GBPINR: (Intraday bias – Range bound.
Support Jan futures- 105.80 and 105.60.
Resistance – 106.30 and 106.50.
After a post-US CPI release dip, both GBPUSD and GBPINR exhibited a rebound. However, initiating fresh long positions in GBPINR at current levels is not recommended. It's prudent to await a pullback towards the 105.60/80 zone before considering new long positions. The overall bias remains upward, contingent on GBPUSD staying above 1.2680. Key support for GBPINR lies at 105.80 and 105.60, with anticipated resistance near 106.30 and 106.50. Traders should vigilantly monitor these levels for informed decision-making in the current market conditions.
EURINR: (Intraday Bias- Upward drift.
Support Jan futures – 91.00 and 90.75,
Resistance – 91.50 and 91.75)
U.S. consumer prices rose 0.3% in December, surpassing expectations, with rents maintaining an upward trend, registering a 3.4% annual increase. Despite this, traders are pricing in a 71% likelihood of a 25-basis point cut in March, expecting a total of 150-175 bps cuts in 2024, as per CME Group's FedWatch Tool. Cleveland Fed President Loretta Mester suggests the recent CPI data might delay a March rate cut. Traders await weaker data and a more optimistic Fed stance; a delay could shift rate cut expectations to May-June, potentially boosting the USD. Meanwhile, EURUSD and EURINR traders can find support in buying dips, with 1.0880/1.0900 as a strong support zone. Vigilance is key as market dynamics unfold.
JPYINR: (Intra-day bias- Range bound.
Support Jan futures- 57.35 and 57.15,
Resistance- 57.75 and 58.00)
USDJPY weakened overnight due to softened US bond yields, resulting in a higher opening for JPYINR. If this downward correction persists next week, USDJPY may decline towards 143.00, providing a potential shorting opportunity for JPY carry traders or JPYINR short traders. A move towards 143.00 could mean JPYINR testing the 58.00/58.20 region. Positional shorts should consider maintaining a stop based on USDJPY below 140.00 or above 59.50/60 levels in JPYINR for risk management.
Forwarded from Kotak Securities
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A reason why money markets did not pay much attention to the uptick in the US CPI inflation measure