FX option expiries scheduled for 26 May at the New York cut include notable figures for various currency pairs. EUR/USD has an option expiry at 1.1300 amounting to €821 million.

USD/JPY shows multiple expiries, with the amounts being $608 million at 142.00, $735 million at 143.00, and $1 billion at 144.00. USD/CAD features an expiry at 1.4000 with a total of $886 million.

NZD/USD has an option expiry at 0.5980 worth NZ$513 million. The information provided serves solely for illustrative purposes and should not be interpreted as financial advice.

Individuals should conduct independent research before making investment decisions. There is no assurance that the information presented is free of errors or up-to-date.

Market Participants And Their Insights

The upcoming option expiries on 26 May at the New York cut reveal concentrations of interest around a few precise strike levels, reflecting strategic positioning by market participants. Perhaps the most marked amount sits with EUR/USD, where nearly €821 million is lined up at the 1.1300 strike. What this tells us is that there is deliberate hedging or speculation at this level, hinting that traders are either protecting gains from recent movement or anticipating resistance should the euro approach that area.

In dollar-yen, the clustered strikes at 142.00, 143.00, and especially 144.00—where notional value exceeds $1 billion—suggest a more layered narrative. That kind of volume over three whole figures may imply that we’re dealing with defensive structures such as barrier options, or a build-up of interest expecting price compression in a fairly defined band. When we look at this structurally, it’s likely that short-dated volatility sellers have been active, perhaps trying to capitalise on range-bound action after last week’s yen strength saw temporary exhaustion.

For dollar-loonie, the 1.4000 strike at $886 million isn’t just any round number. Its psychological weight makes it a natural magnet for flows, especially near expiry. If spot price spends any time within striking distance of that level in the days ahead, sharp price responses could become visible—whether from delta hedging or option holders trying to manipulate the fix.

Then there’s the 0.5980 strike on the kiwi pair, albeit in New Zealand dollars, but a half-billion NZD is hardly negligible. The odd cent value there suggests a bespoke structure or a hedging mechanism against a very specific risk scenario. Probably tailored flow from a corporate or institutional exposure, and those can at times exert outsized influence should the spot hover close to the strike.

Tactical Considerations For FX Traders

Now, from a tactical angle, we might want to pay attention to how spot behaves as it nears any of these strike zones—particularly within 24 hours of expiry. Pinning is not just theory; we’ve all watched it occur. Traders should be ready not only to adjust positions as gamma kicks in, but also to anticipate moments of artificially low volatility as market makers manage their books into the fix. Flattening exposure just ahead of expiry may provide more value than chasing distorted intraday signals.

Given the clustering of notional value in some of these instruments, especially those priced in billions, it’s possible we see unusual price behaviour that wouldn’t align with broader market sentiment. We’ve seen this happen near expiry—price drifts toward the largest strike as dealers hedge exposures, creating temporary support or resistance. Recognising when dynamics are driven more by positioning than fundamentals can be powerful. And it isn’t theory; it’s well-observed behaviour over years of expiry trading.

Lastly, careful monitoring as we approach the expiry window matters. Volumes can dry up suddenly, spreads may widen as providers pare back risk, and this can all lead to exaggerated moves over just a few ticks. We would be cautious leaning too heavily on technical signals near these areas. Using implied volatility data alongside spot price movement could give us clearer insight into whether these levels are likely to stick or not.

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