We spotted out a hanging man formation is almost likely on weekly charts on upswings with just US session remaining of this weekend but there was no clarity from leading oscillators but looking stronger even though both RSI and stochastic reached overbought zones.
So, we recommend on speculation basis buying one touch binary vega calls in order to extract leverage on extended profits. By employing these binary vega calls one can not only multiply the returns by twice, thrice or even pour returns unimaginably but also upbeat the implied volatility that is perceived at 10.55% which is 5th highest from major currency baskets. But do remember this call is strictly on speculative grounds considering IV factor.
As we believe one touch Vega spreads can be the best suitable options to trade HY vols. The prime merits of such one touch option spreads are high yields generation 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.
But on hedging grounds we recommend arresting potential downside risks of this pair by hedging through calendar Put Ratio back spreads. So purchase 1M 2 lots of At-The-Money -0.48 delta puts and sell 7D one lot of (1%) In-The-Money put option in the ratio of 2:1 . The rationale being short term trend reversal or sideways is anticipated, so that shorting ITM puts to fetch certain yields in short run.
