Insight: Global Speculators & Institutional Funds Portfolio at Risk

The expected volatility would weigh heavy on CABLE & EURO; not withstanding what the JP YEN has been doing lately as it gains strength prior to event risk. There has been a lot of spread betting in the currency markets nowadays especially with the obvious bias of most traders bearish on the British Pound with a recent low @1.4115 while pulling back to its current levels @1.4199 to this writing.

The analogy of these price levels with both the EURO @1.1293 well below the 1.1380 and CABLE's present levels @1.4199 well below the 1.4380 resistance, would be traded with a bearish bias before the main events this coming weeks. Retail speculators may well be advised not to engage in such expected volatility unless they are willing to risk in exchange for a decent gain where prices can whipsaw in both direction simply because of a wider trading range. Buy & Sell positions relatively can make money only with exceptional timing entry / exit strategies in place. The likes of utilizing the Euro & Pound related Cross rates along spot would be a great combination. However, there are no real guarantees of any sure fire wins. This is were speculative moves are made prior to events and post trades are mere confirmation when a lot of contracts change hands on the spot.

Institutional funds presently holding cash & blocks of open contracts in options should be considered for hedging purposes which is currently being adjusted heading towards the next trading days / weeks ahead. Leverage trades would only be a fraction of institution's portfolio, but would outweigh commercials  and retail speculators post any event risk announcements. It is advised to monitor VOI and options positioning. A smart playbook with a combination of Spot Majors / Cross Rates, Futures & Options will be quite useful instead of simply trading naked in the market.