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XM Research

Volatility Report – January 16, 2024

- Achilleas Georgolopoulos

  • Volatility crashed across the FX spectrum including EUR/USD and JPY crosses

  • Gold and Silver volatility drops; oil and Bitcoin set for sizeable moves

  • Stock indices in turbulent waters, JP225 volatility records a new monthly high

 The recent range-trading in EUR/USD has caused the expected volatility to drop to the lowest level of the past month, despite some key data releases. This expectation for small price movements going forward is also depicted in the remaining currencies covered in this report and predominantly in the yen crosses.

In the commodities space, gold and silver implied volatility continues its downward move despite the decent weekly price changes. In contrast, developments in the Red Sea have caused oil prices to drop, thus pushing volatility to the top of its monthly range.

Turning to risky assets and the implied volatility of most stock indices remains very high except for the US 500 index. Interestingly, the JP 255 index made a new 34-year price high causing its implied volatility to reach a new monthly high.

In the meantime, the much-touted spot-Bitcoin ETF approval has resulted in a significant price retreat in the king of cryptos with implied volatility surging at the top of the 30-day range.

We have prepared a video and a guide detailing the Volatility Report's structure and importance.

Please see the following report

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