Forex options markets volatility expectations have trended consistently lower through recent price action, suggesting currencies may remain in tight trading ranges in the week ahead. Our 1-week volatility index has nearly matched its lowest levels since 2008 and shows little trader appetite for big currency swings. Of course, there are always two ways to interpret said slowdown in volatility. Some may argue that such depressed currency ranges may simply be the calm before the storm, and markets may soon see major breakouts. The more likely scenario, however, is that volatility will remain depressed through the foreseeable future. This leaves us with little option but to favor Range strategies in the week ahead.

Forex options markets volatility expectations have trended consistently lower through recent price action, suggesting currencies may remain in tight trading ranges in the week ahead. The euro and Swiss franc closed Thursday just below yesterday’s highs against the US dollar, but given the very tight trading ranges and low liquidity... US economic data helped provide a boost to equities, and thus weighed on the US dollar and Japanese yen, though trading ranges across the majors were so...