FxWirePro: Hanging man and Gravestone DOJI formation alert USD/CAD downswings; one touch vega spreads to trade HY vols

When we plotted daily chart, it seems to have U turn on USDCAD pair as the US dollar taking a halt from its non-stop ruthless bull run against CAD which has started almost a month ago (on 18^th June). The crude price has such ruthless slumps in CAD. The pair has spiked up from the lows 1.2126 levels with minor hick-ups to reach 6 year's highs.

We spotted out a hanging man and Gravestone Doji on EOD charts on upswings at 1.3035 and 1.3041 respectively and in addition there is a clear sell call finally from leading oscillators signal overbought pressures as RSI (14) evidences downward divergence with the previous prices of pair's uptrend and %D line crossover above 80 levels on stochastic.

Since the implied volatility of this pair also is perceived as quite higher among G7 currency basket (currently, IV of this pair is 10.3% for 1W ATM contracts), we recommend on speculation basis buying one touch binary vega puts in order to derive leverage benefits. By employing these ATM binary vega puts one can not only multiply the returns by twice, thrice or even pour returns unimaginably but also upbeat the implied volatility. But do remember this call is strictly on speculative grounds.

The prime merits of such one touch option spreads are high yields during high volatility plays. Wider spreads indicates lack of liquidity. The spreads for one touch USD/CAD options are constant time and barrier levels. Usually, such binary options for every change in 1 pip the relative change in option price 0.01% or even exponential at high implied volatility times. We all know that the major driving force for loony's depreciation has been dropping global crude prices.