Crude Breaks the Slide, Volatility Slips

Taking a fall of about thirty percent, the crude options volatility fell down as the underlying future options went up for the first time in the last four days.
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Oct. 2, 2012 - PRLog -- USD

Mixed data from US causes USD to fall

After the announcement of mixed data from the US economy, the world’s most detrimental currency, the Dollar was seen falling down against its other major counterparts this Thursday. Some traders were also inclined towards buying the Euro after the Spanish authorities outlined an improved budget plan for the debt ridden state.

The annual data from the US showed that the world’s largest economy had grown at a much slower rate during the April - June period than what had been estimated previously. All this was accompanied by major companies cutting down their orders and the number of US citizens that sought unemployment benefits fell down. Therefore, what followed was that lesser number of American people signed upon contracts buying homes that had been previously occupied in the month of August as compared with the month of July.

The Dollar was seen trading at 77.62 JPY and 0.9371 Swiss Franc and 98.06 Canadian Cents.


Spain pledges: Euro Gains

Following the announcement of the pledge by the Spanish Government to meet its deficit spurred aspirations amongst traders that Spain would make it out of the currently ongoing crisis causing the EURO to open significantly higher and maintain its advance through the trade.

Experts believe that there is absolutely no doubt that Spain would have to ask for some aid sooner or later and that the Spanish authorities are merely trying to take control of their own house as much as possible so that they get to negotiate better when the time comes.

The 17 nation shared currency fell down by 0.5 percent since late September, making its quarterly advance approximately two percent.

Japanese Yen

Japan to share worry over Yen at next G7 meet

Jun Azumi, the Finance Minister of Japan was quoted as saying that his successor is likely to discuss the headwinds that the Japanese economy is facing due to resistance from a strong Yen in the coming meet of the Finance Ministers of the G-7 states in the following month.

Azumi seemed hopeful that the Finance Ministers would be able to understand the demerits of having a strong Yen in the market dynamics when they meet in the G7 summit and in the meeting of the International Monetary Fund when they are hosted by Tokyo. It would be interesting to see what policy decisions are taken forth as Azumi takes up the post of the secretary general of the Democratic party and he is replaced by a candidate whose name has not been announced yet.


Crude Options Volatility Falls Down

Taking a fall of about thirty percent, the crude options volatility fell down as the underlying future options went up for the first time in the last four days. Implied volatility which is a measure of the swing in the prices of futures and helps in gauging the prices was seen at 29.08 levels down from its previous 31.7 mark. Experts say that when the price of crude goes up, then volatility goes down which is very typical of the option market.
For the month of November, the delivery of crude oil rose by 2.1 percent to approximately $1.87 on the New York Mercantile Exchange.

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