Tag: charting

The Geopolitics of Currencies

The Geopolitics of Currencies

The 1944 Bretton Woods agreement jumpstarted the dollar into its reserve currency status. While economists proposed global trust and confidence in the US ability to pay its obligations, a more compelling justitification has its roots in United States’ political influence.

The Volatility Premium and Black-Scholes Pricing

The Volatility Premium and Black-Scholes Pricing

The implied volatility is generally equal to or significantly greater than the forecasted volatility; for instance, the BSM implied volatility is, in general, an upward biased estimator. Indeed, by selling implied volatility a risk premium is provided because of the many expected and unexpected events that may occur. Moreover, market microstructure posits that implied volatility should be biased high because market makers profit from the bid-ask spread in the options by slightly raising their quotes (i.e., going slight long volatility exposure particularly on the downside). However, this absolutely doesn’t mean that it is always possible to profit by selling implied volatility

Currency Market

Currency Market

The International Currency Market, or FOREX, is an over-the-counter market where banks, central banks, sharks, investment management firms, hedge funds, and brokers buy and sell currencies. In general, the key drivers of FOREX are Central Bank Interest Rates, Central Bank Intervention, Options, Fear and Greed, and News. Forex Screener by TradingView Technical analysis in the…

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