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    A significant EUR/USD expiry at 1.1800 could impact price movements on that day

    by VT Markets
    /
    Sep 18, 2025
    On September 18, a significant forex option expiry at the 1.1800 level for EUR/USD could affect market movements by drawing prices toward it. As traders react to recent actions from the Federal Reserve, the dollar has gained strength while stock markets are recovering. The Fed’s decision presents a mix of optimism and caution, making it hard to predict market direction. Analysts struggle to find a clear trend, whether leaning towards a stronger or weaker dollar.

    Mixed Reactions Following The Fed

    The market is reacting in varied ways as it processes the Fed’s decision to keep interest rates steady. The dollar is slightly up, but the Fed’s unclear stance on future policy has left both hawks and doves debating. This uncertainty makes sense since core CPI remains stubborn at 2.8%, even as the labor market shows signs of cooling. Amid this unpredictability, a large options expiry for EUR/USD is set for today at 10 AM New York time. The significant interest at the 1.0800 strike price could act like a magnet, potentially limiting big price changes in the short term. Traders often hedge their positions around these key levels, which keeps movements contained. For derivative traders, this situation might suggest that selling short-term volatility could be a good strategy, especially with the 1.0800 level holding the market steady. Looking back at the sharp price moves of 2023 and 2024, the current market is more focused on range trading. We should remain cautious, as lower volatility might lead to complacency before a breakout happens.

    Impact Of Transatlantic Policy Divergence

    This situation isn’t only about the Fed; the European Central Bank’s dovish stance is preventing any real gains for the euro. Recent Eurozone PMI figures have stayed just below the 50-point mark, indicating ongoing economic weakness. This difference in policies suggests that any drop in the dollar may be temporary, favoring strategies that do not expect a strong recovery for the euro. Create your live VT Markets account and start trading now.

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