On 7 March at 10am New York time, there are notable FX option expiries, particularly for USD/CAD at the 1.4350-60 levels. These expiries appear to have minimal technical impact, with the 100 and 200-hour moving averages currently at 1.4378-98.
The expiries may restrict any upward movement until the release of US and Canadian labour market data. After this data, fluctuations may continue to be influenced by the expiries before they roll off.
Additionally, there is an expiry for AUD/USD at the 0.6300 level, which also lacks technical significance but may attract attention until US trading and the non-farm payrolls are released.
Short Term Price Movements
The details outlined above indicate that short-term price movements may be constrained around key expiry levels, particularly for the US dollar against both the Canadian and Australian dollars. The expiry levels for USD/CAD near 1.4350-60 are unlikely to dictate broader trends, especially considering that both the 100-hour and 200-hour moving averages are positioned well above that range. Historically, price action in such scenarios tends to respect these levels until either the expiries roll off or a major catalyst shifts momentum. In this case, the upcoming labour market data from both sides of the border stands as that potential catalyst.
Until the employment reports are published, movements in USD/CAD could be hesitant, with price action repeatedly pulled back toward the expiry range. However, once the data is available, volatility might increase, particularly if reported figures deviate from expectations. Any divergence in job numbers or wage growth between the two economies could influence expectations around central bank policy, ultimately having a far greater influence than the expiring options themselves.
Meanwhile, AUD/USD’s expiry at 0.6300 suggests a similar situation. While this level does not align with any key technical indicators, traders may still observe price reluctance around it heading into US trading hours. The release of non-farm payrolls has historically triggered movements across multiple currency pairs, including this one, and any unexpected data may lead to an abrupt reaction. Before that point, the expiry itself could play a role in temporary price stabilisation.
Market Interpretation Ahead
What follows in the coming weeks will depend on how markets interpret the employment data and its implications. Should either report result in a reassessment of interest rate expectations, the effect could extend beyond a single trading session. For now, the observed expiries serve as short-term areas of interest, but attention will inevitably shift to broader factors once immediate influences dissipate.
