EUR/USD Analysis: OI In Call Options Rises For Second Day

• Head and Shoulders neckline resistance likely to fall as OI in call options rises for second day.

After looking at a price chart, one could argue that the recovery in the EUR/USD from the Friday's low of 1.1574 has run out of steam near 1.1660.

However, the EUR/USD November expiry options data published by the CME still shows a potential for a corrective rally above 1.1671 (head and shoulders neckline hurdle).

EUR/USD EUUX7 Open Interest Change: Current (Oct 31 - Prelim) vs. Oct 30

Call Summary
Total ITM OTM
OI Chg OI Chg OI Chg
62,164 1,492 3,847 111 58,317 1,381

Put Summary
Total ITM OTM
OI Chg OI Chg OI Chg
58,251 142 20,697 61 37,554 81

• The open interest (OI) or open positions in the call options increased by 1492 contracts on Tuesday. The call options had witnessed an addition of 1734 contracts on Monday.
• Max additions were seen in 1.1850 call, 1.18 call and 1.1750 call.
• Meanwhile, the put options added only 142 contracts to open interest.

The changes in open interest indicate the investors expects a quick fire technical rally in the spot towards 1.1750-1.18 levels ahead of the expiry on Nov. 3

EUR/USD EUUX7 Open Interest Change: Current (Oct 31 - Prelim) vs. Oct 24

Call Summary
Total ITM OTM
OI Chg OI Chg OI Chg
62,164 7,161 3,847 1,796 58,317 5,365

Put Summary
Total ITM OTM
OI Chg OI Chg OI Chg
58,251 2,836 20,697 470 37,554 2,366

• Over the last one week, the open positions in the call options have gone up by 7161 contracts, while the put options added only 2836 contracts.
• It only corroborates the view that a technical rally is likely ahead of the expiry on Nov. 3.

EUR/USD daily chart

• Head and shoulders neckline hurdle stands at 1.1671.
• The falling channel ceiling is seen offering resistance around 1.1810.
• The upward sloping 100-day MA stands at 1.1690.