USDJPY coverage is lacking topside – Forex option expiries 24 April 2018

Forex option expiries for the 10 am (14.00 GMT) New York cut 24 April 2018

What’s standing out on the options landscape is a lack of upside coverage in USDJPY. Just looking at this week, there’s very little showing above 109.

USDJPY Options spread

That’s actually the same sort of picture we’ve previously mentioned about the downside a few months ago, when the price came under 110 & 108. There was very little coverage (and it still is sparse) under 105/104. That tells us that traders were expecting the price to stay within the range of 105-110 (give or take some change). It’s also why we’re seeing some barriers popping up at 108 & 109, and they are rumoured to be at 109.50 & 110.00 too (once I get full confirmation of those I’ll add them to the board). Of course, that doesn’t mean the price will stay within these boundaries but it will likely mean that it’s got a lot a lot to chew through to break those higher levels, and that means we could see some decent action around these bigger levels, such as we’re seeing today around 109.

Back to today’s board and EURUSD is one pair that has plenty up top.