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    Key FX option expiry for EUR/USD at 1.1690 may limit downside movements.

    by VT Markets
    /
    Sep 15, 2025
    **A Large Option Expiry Influences EUR/USD** The impact of the recent expiry is likely minor, as the dollar has shown weak performance since last week. No other expiry seems to notably affect immediate market activities. A large option expiry at 1.1690 is keeping EUR/USD near the 1.1700 support level for today. This is creating a pull on the price, likely preventing significant drops before the 10 AM New York cut. For now, this indicates that price movement will stay limited. The dollar has been weak lately, especially after last week’s US CPI report for August 2025, which came in slightly lower than expected at 2.8%. This, along with the steady but unimpressive 175,000 jobs added in the latest payrolls report, keeps the Federal Reserve cautious. The lack of a strong direction from the US supports a range-bound view for major currency pairs. **A Viable Strategy for Low Volatility** In this situation, selling volatility seems like a good strategy for the next few weeks. We could look at short strangles or iron condors on EUR/USD, aiming to collect premiums while the pair moves sideways. The key is to set these trades outside a likely trading range, perhaps between 1.1550 and 1.1850. We recall how the 1.1600-1.1900 zone was a significant area of congestion for the pair in late 2020 and early 2021. History shows that long periods of low volatility, like what we are currently experiencing, can lead to sharp breakouts. Therefore, any short-volatility positions should be managed with strict risk parameters. On the European side, the recent comments from the ECB have also been cautious, with officials noting slowing German manufacturing PMI data. This dual caution from both the Fed and the ECB diminishes the outlook for a strong trend. It suggests that the market is waiting for a more significant economic signal before making its next major move. Create your live VT Markets account and start trading now.

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