http://www.forexconspiracyreport.com/forex-options-volatility-index/ Forex Options Volatility Index A useful tool for stock trades is the VIX index. Is there also a Forex options volatility index? VIX is a trademarked ticker symbol for the Chicago Board Options Exchange Market Volatility Index. This index is a popular measure of the implied volatility of S&P 500 index options. The VIX is commonly called the fear index or the fear gauge. It measures traders’ expectations of stock market volatility over the coming 30 days. Many stock traders include this index in their market assessment and trade more profitably than without it. The closest thing to a Forex options volatility index also comes from the Chicago Board Options Exchange. It is the CBOE EuroCurrency ETF Volatility Index. What exactly is this Forex options volatility index and how does it help traders? CBOE EuroCurrency ETF Volatility Index According to the CBOE, the CBOE Eurocurrency volatility index measures the market’s expectation of 30-day volatility of the $US/Euro exchange rate by applying the VIX methodology to options on the CurrencyShares Euro Trust (Ticker – FXE). Like other VIX benchmarks, EVZ uses options spanning a wide range of strike prices. FXE is an exchange-traded fund (ETF) that holds Euro on-demand deposits in Euro-denominated bank accounts. As such, the performance of FXE is intended to reflect the $US/Euro exchange rate, less fund expenses. Following is a chart comparing FXE prices with the spot Euro exchange rate. Thus the Forex options volatility index that can be applied to trading the USD/EUR currency pair is the CBOE EuroCurrency ETF Volatility Index, So, what does a volatility index really tell us? Volatility Indexes According to Investopedia a CBOE volatility index provide a view of investors’ expectations on future market volatility. VIX values greater than 30 are generally associated with a large amount of volatility as a result of investor fear or uncertainty, while values below 20 generally correspond to less stressful, even complacent, times in the markets. In short a high VIX number predicts a volatile market and a low VIX number predicts a tranquil market. The Forex options volatility index, CBOE Eurocurrency volatility index, for the USD/EUR pair applies to trading the US dollar versus the Euro. Forex Market Signals A VIX index is a signal. It does not tell us if the market is going up or down. It tells us that a lot of traders are uncertain. A comparable Forex trading signal is the Doji signal in the Japanese Candlestick system. The Doji Candlestick signals a change in a trend and momentary market indecision as this switch occurs. The appearance of a Doji after a long uptrend is a warning to investors that the trend is either close to peaking, or has already peaked in the open markets. On the other hand, after a long downtrend the exact opposite is true and prices have been forced down.

1. By: www.ForexConspiracyReport.com

2. A useful tool for stock trades is the
VIX index. Is there also a Forex
options volatility index?

3. VIX is a trademarked ticker symbol
for the Chicago Board Options
Exchange Market Volatility Index.

4. Before We Continue…
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5. This index is a popular measure of
the implied volatility of S&P 500
index options. The VIX is commonly
called the fear index or the fear
gauge.

6. It measures traders’ expectations of
stock market volatility over the
coming 30 days.

7. Many stock traders include this
index in their market assessment and
trade more profitably than without
it.

8. The closest thing to a Forex options
volatility index also comes from the
Chicago Board Options Exchange.

9. It is the CBOE EuroCurrency ETF
Volatility Index. What exactly is this
Forex options volatility index and
how does it help traders?

10. CBOE EuroCurrency ETF
Volatility Index

11. According to the CBOE, the CBOE
Eurocurrency volatility index

12. measures the market’s expectation of 30-
day volatility of the $US/Euro exchange
rate by applying the VIX methodology to
options on the CurrencyShares Euro
Trust (Ticker – FXE).

13. Like other VIX benchmarks, EVZ uses
options spanning a wide range of strike
prices.

14. FXE is an exchange-traded fund (ETF)
that holds Euro on-demand deposits in
Euro-denominated bank accounts.

15. As such, the performance of FXE is
intended to reflect the $US/Euro
exchange rate, less fund expenses.

16. Following is a chart comparing FXE
prices with the spot Euro exchange rate.

17. Thus the Forex options volatility
index that can be applied to trading
the USD/EUR currency pair is the
CBOE EuroCurrency ETF Volatility
Index,

18. So, what does a volatility index
really tell us?

19. Volatility Indexes

20. According to Investopedia a CBOE
volatility index provide a

21. view of investors’ expectations on future
market volatility.

22. VIX values greater than 30 are generally
associated with a large amount of
volatility as a result of investor fear or
uncertainty, while values below 20
generally correspond to less stressful,
even complacent, times in the markets.

23. In short a high VIX number predicts
a volatile market and a low VIX
number predicts a tranquil market.

24. The Forex options volatility index,
CBOE Eurocurrency volatility index,
for the USD/EUR pair applies to
trading the US dollar versus the
Euro.

25. Forex Market Signals

26. A VIX index is a signal. It does not
tell us if the market is going up or
down. It tells us that a lot of traders
are uncertain.

27. A comparable Forex trading signal is
the Doji signal in the Japanese
Candlestick system.

28. The Doji Candlestick signals a
change in a trend and momentary
market indecision as this switch
occurs.

29. The appearance of a Doji after a long
uptrend is a warning to investors that
the trend is either close to peaking, or
has already peaked in the open markets.

30. On the other hand, after a long
downtrend the exact opposite is true and
prices have been forced down.

31. There are four types of Doji candlesticks
that investors must learn before day
trading stock online using Japanese
candlesticks.

32. These four types include the common
Doji, the long-legged, the dragonfly, and
the gravestone.

33. The basic Doji signal was already
discussed however the three additional
types of Doji signals are explained
below.

34. Signals such as the Forex options
volatility index for the USD/EUR
pair give the trader a clue as to
coming market changes.

35. They should never be used alone but
in concert with sound fundamental
analysis of the currency pair and up
to the minute analysis of market
sentiment.