The US dollar is coming under renewed pressure this morning as the Fed and Geopolitical tensions come into focus.  Fridayââ,¬â"¢s better than expected Nonfarm Payrolls report gave the Greenback some strength, but once again, speculation regarding the Fedââ,¬â"¢s next move is taking over.  Comments from St. Louis Fed President Poole implied that 5.25% was a reasonable level considering the information they now have in hand.  Reports surfaced this weekend that the US may be considering military strikes against Iranââ,¬â"¢s nuclear installations.  These reports sent the price of crude oil, and gold bullion higher. 

A quiet week is in store in terms of economic data.  Vols are off in the front end as traders square their books ahead of the holiday weekend.  Little is changed from last week in terms of risk reversals.  JPY calls and EUR Calls are still favored.

Option Trade Samples

Below please find some strategies, which depending on your view might be applicable.  Please bear in mind that all of these trades can be applied to any of the currency pairs, which may be traded.  All barrier levels, strikes, triggers, payouts, and maturity dates can be tailored to each individualââ,¬â"¢s views.

Kathy Lien is the Chief Currency Strategist at FXCM.

Disclaimer: Transactions in options carry a high degree of risk. Purchasers and sellers of options should familiarize themselves with the type of option (i.e., put or call) which they contemplate trading and the associated risks. You should calculate the extent to which the value of the options must increase for your position to become profitable, taking into account the premium and all transaction costs.