CAD Implied Volatilty at Fresh 2 Yr. Highs

Important Note: The charts contained herein are not based on spot FX. All charts shown in this post are those based on the September CME Canadian dollar futures and options contract. This is for illustration purposes only and is not intended to favor a position of spot FX over futures or vise versa. Canadian Dollar option implied volatility has surged over the past 12 months and now sits at fresh two- year highs. To play this high reading in option implied volatility I have constructed an option spread designed for high volatile situations as illustrated below. We could utilize an option trade that is delta neutral. However, based on other indicators I’m opting to setup a high implied volatility option spread that is also leaning toward the bullish side. As noted on the chart below there is solid... [read full story]                    

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