OPTIONS: Call Condors, Spreads, Outrights Feature Wednesday

Monday's Europe rates/bond options flow included:

• OEH5 116.75/116.50ps, bought for 15 in 13k.
• RXG5 130/129ps, sold at 20 in 4k.
• ERG5 97.87/97.75/97.62p fly, bought for 0.75 in 2k.
• ERH5 97.4375/97.5625/97.6875, sold at 4.25 in 1k
• 0RG5 97.875/98.00/98.12c fly, bought for 1.75 in 4k.
• 0RG5 98.00/98.125/98.25c ladder, bought for 1 in 6k.

• -8,000 SFRM5 95.62/95.75 put spds, 6.25 ref 95.815
• -5,000 SFRU5 95.87/96.06 call spds vs 95.25 put, 0-.25 ref 95.86
• -15,000 0QH5 96.06/96.31 1x2 call spds, .25 ref 95.85
• +5,000 SFRN5 96.00/96.37 call spds, 8.5 vs. 95.865/0.18%
• +5,000 0QM5 96.25/96.37 call spds 1.0 over SFRM5 96.06/96.18 call spd
• +10,000 0QH5 96.00/96.25/96.81 1x1x2 call trees, +3.25 net ref 95.865
• +5,000 SFRZ5 95.50/96.00/96.50 call flys, 10.75 ref 95.885

• More stable equity markets since the European open have helped curtail the Japanese yen bid on Monday, with the push below 157.00 for USDJPY seeing a decent 60 pip reversal across the US session.
• In similar vein, the likes of EURUSD rising back above 1.02 and GBPUSD extending its bounce from the 1.21 handle have assisted a strong recovery for both EURJPY and GBPJPY.
• The trend condition in EURUSD remains bearish and recent short-term gains have proved to be a correction. The recent break of 1.0226 confirms a resumption of the downtrend and marks an extension of the price sequence of lower lows and lower highs. Sights are on 1.0138 next, a Fibonacci projection.
• For GBPJPY, early price action saw the cross briefly extend losses since Dec 30 to 4.5%, before 190.00 acted as decent support. We have seen the cross retrace the best part of 1% to levels around 191.75, despite remaining down on the session.
• Overall, the USD index is still holding on to moderate gains, with the post-NFP greenback impetus still present. The DXY printed a fresh cycle high at 110.17 before slipping back just below the 110 mark. Commodity currencies have traded with relatively contained ranges, whereas USDCHF had its first print above 0.9200 since May last year as the pair approaches key medium-term resistance at 0.9224/44.
• US PPI on Tuesday provides a warm-up for the main CPI data on Wednesday, when UK inflation data is also due.