USD/CAD Options Pricing Calling for Big Movement on BoC

What’s inside:

  • USDCAD one-day implied volatility balloons to nearly 23% ahead of today’s BoC meeting
  • The projected one-standard deviation daily range is 12235 to 12531
  • The pair is trading at a major long-term trend-line, today could make or break that line

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In following table, you’ll find levels of implied volatility (IV) for major USD-pairs for the next one-day and one-week time-frames. Using these levels, we’ve derived the range low/high prices from the current spot price within one-standard deviation for specified time-frames. Statistically speaking, there is a 68% probability that price will remain within the lower and upper-bounds.

USD/CAD Options Pricing Calling for Big Movement on BoC

One-day implied volatility swells to nearly 23%, points to a potential 1-stdev range of 12235-12531

At 14:00 GMT time, the Bank of Canada will release its decision on interest rates, with expectations that it will keep its benchmark rate at 0.75%. The bigger risk, barring a surprise raise, is likely to come with the central bank’s policy statement. (For more a deeper look, Article source: https://www.dailyfx.com/forex/technical/article/special_report/2017/09/06/USDCAD-Options-Pricing-Calling-for-Big-Movement-on-BoC-PRtech.html?DFXfeeds=forex:technical:article:special_report