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Draghi Disappointment Fears Spike: FX Volatility Surges To 30-Month Highs

Tyler Durden's picture




 

While US equity implied volatility has been flat to slightly higher in the last week (as stocks have soared), FX volatility has remained near record lows... until today. Ahead of Draghi's big day tomorrow, EURUSD implied volatility has spiked from around 5 to over 17 - its highest since Dec 2011 - as investor anxiety over Draghi disappointing mixes with a record high short position in EUR FX Futures... it seems more than a few are concerned that Draghi's promise is more hope than reality.

 

 

Chart: Bloomberg

 

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Wed, 06/04/2014 - 12:01 | 4823449 Relentless101
Relentless101's picture

This time, I really fucking mean it!!!

Wed, 06/04/2014 - 12:03 | 4823459 Capitalist
Capitalist's picture

Everyone buying EURUSD strangles I assume.

Wed, 06/04/2014 - 12:09 | 4823477 spastic_colon
spastic_colon's picture

everyone keep repeating....draghi apple split, draghi apple split............its all that matters for global equities right now

 

::: : : ::: ::

Wed, 06/04/2014 - 12:23 | 4823534 Say What Again
Say What Again's picture

Off Topic, but...

 

Did NASD break?!?!?!?

 

No access to trade server

Wed, 06/04/2014 - 12:01 | 4823450 maskone909
maskone909's picture

james rickards implied that the ECB is indirectly printing by means of buying treasuries and swaping for euros.  hence Belgium treasury buying spree.  they will need it, afterall they never re-capped their banks and rumor has it deutschebank is in trouble

Wed, 06/04/2014 - 12:16 | 4823506 disabledvet
disabledvet's picture

This is a very interesting theory..."betting on no recovery USA to create Major Depression Europe" so interest rates collapse.

Of course "and then what?" becomes the question. If Italy is actually attacked or invaded...there is no one there to defend them.

"Scorched Earth."

Wed, 06/04/2014 - 12:01 | 4823451 tradebot
tradebot's picture

none of this will change anything

Wed, 06/04/2014 - 12:13 | 4823495 AccreditedEYE
AccreditedEYE's picture

Correct

Wed, 06/04/2014 - 12:01 | 4823453 JustObserving
JustObserving's picture

Draghi will do what the Fed tells him to do.

Wed, 06/04/2014 - 12:18 | 4823513 disabledvet
disabledvet's picture

You mean Goldman Sachs. "Sure wouldn't want to be Israel right now."

They're being sold out for friggin beads and seashells.

Wed, 06/04/2014 - 12:02 | 4823454 Eyeroller
Eyeroller's picture

Unlike the American Ponzi Munchkin, Draghi has the recent European election results to contend with.

Wed, 06/04/2014 - 12:11 | 4823491 101 years and c...
101 years and counting's picture

i havent laughed that hard in weeks.  draghi worried about election results?  too funny.  the elected are just puppets for the unelected banker overlords.

Wed, 06/04/2014 - 12:13 | 4823496 Stoploss
Stoploss's picture

It would appear that the significant weakness in the euro about the third week in May, could be related to significant S&P strength since the third week of May?

Mario has his own printer???

I smell a bond short covering spreeeeeeeeeeeeeeeee.........

Wed, 06/04/2014 - 12:18 | 4823515 vote_libertaria...
vote_libertarian_party's picture

and yet VIX hangs out near all time lows

Wed, 06/04/2014 - 12:20 | 4823520 Yen Cross
Yen Cross's picture

      I think I saw Draghi last night... I was whistling pass the graveyard on my midnight stroll before the London markets opened.

     Draghi will do too little too late, and the usd is overbought on the daily chart. My guess is any spikes down in the euro will be quickly faded, and the usd will sell off along with dropping bond yields. I might have to short usd/jpy here in the next day or so.

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