Please observe how delta risk reversal numbers are getting higher negative values gradually in a long run (flashing at negative 1.65 for 1 year expiries).
Volatility smiles most frequently show that traders are willing to pay higher implied volatility prices as the strike price grows aggressively out of the money. (IV grows at 12.2% which is quite higher).
1W At The Money 50% delta puts are trading 13% higher than NPV.
The current spot FX is trading at 136.555, we expect dips extending up to 133.372 levels in near terms. It is understood that bearish momentum is bolstering as we saw that from delta risk reversal table and technical indications. Hence, aggressive bears can initiate strategy using ATM puts.
The broader the strike difference between short and long puts, the fewer puts you need to sell to cover the price of the long puts.
But at the same time, the coverage of long-to-short is going to be more difficult in the event of assignment.
So, the recommendation for now is to add an extra long on put with 1m expiry to the existing debit put spreads and fresh backspreads can built in capitalizing on overpriced ATM puts on short side with 1w expiries.
Since the option you sell will always be lower on the skew curve it means you are getting a better deal on what you are selling compared to what you are buying.
It makes this strategy a good one if the skew is running a little hot but EURJPY hasn't rolled over that much.


BCA Research Warns U.S.-Iran Ceasefire Could Collapse, Maintains Cautious Equity Outlook
Goldman Sachs FICC Revenue Falls 10% Amid Iran War Market Volatility
Want to cut your energy bills? Here’s how five experts are doing it
Why the future of marijuana legalization remains hazy despite high public support
Uranium Bull Market Gains Momentum Amid Supply Deficits and Geopolitical Tensions
Iran’s AI memes are reaching people who don’t follow the news – and winning the propaganda war
Trump’s exchange with Pope Leo reflects deep-rooted tensions between the Vatican and the United States: 4 essential reads
Morgan Stanley Warns Against Overestimating EV Demand Boost from Rising Oil Prices
Google promotes ‘teacher approved’ apps for kids. Here’s what parents should know
Food prices are already high in Canada. Will the Iran war make them worse?
Energy Price Spike Won't Trigger Lasting Inflation, Analysts Say
NVIDIA Acquisition Rumors Dismissed by Morgan Stanley as Strategically Flawed




