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Euro Futures Volatility Forecast (17/01/2011)

The volatility for the Euro futures is dropping fast and the recent surge in price experienced by this market would suggest that the up movement is steady and is not over yet.

The great success of Portugal’s bonds auction increased the confidence of investors towards Euroland and the sudden rise in euro futures prices is simply the graphical representation of such a phenomenon.

The current volatility is 0.76% (12.06% annualised) but it is likely that, by the end of the week, we would have figures around 0.58% – 0.6% (9.20% – 9.52%) which would consequently drive the price up in the 1.35 – 1.38 area.

The staff of HyperVolatility suggests you to go long this week and join the euphoria that is now hitting the Euro zone because it is unlikely to last long. The last weeks have been practically useless to determine a medium term trend due to the ridiculous volume in the market and therefore we advise you to be very careful.

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