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Sell 2W EUR/NOK Call Ahead Of Norges Bank Rate Hike

Published 09/17/2018, 09:27 AM
EUR/NOK
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MMM
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The front end of the EUR/NOK impl. vol curve has spiked higher driven by a repricing of this week's Norges Bank (NB) meeting.

Given what is already in the NOK rates space, we think the current event risk priced in EUR/NOK FX (O/N impl. forward vol. at 16%) is fair - also in an historical context.

The NB meeting is a key event for our bullish NOK call. See FX Trading Portfolio - Sell EUR/NOK spot outright as strategic 3M (NYSE:MMM) trade , 10 September.

In the FX option space, we see value in utilising the spike in impl. vol. and express our bearish EUR/NOK view via a 2W seagull or by selling 1-2W calls.

To read the entire report Please click on the pdf File Below:

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