Jobs report hedging could cause implied volatility to increase ahead of Friday's report

From Investing.com: 2025-02-05 23:51:00

Rates fell sharply yesterday after a weak report, with the 10-year hitting support at 4.4%. The chart shows symmetry in the movement, with the 10-year possibly returning to 4.15%. The USD strengthened as a result, falling below support at 154. The USD/JPY and NASDAQ correlation is in question, as the USD/JPY carry trade becomes less attractive. The BOJ rate hikes are impacting the yen, while China’s 10-year rate is on track to collide with the US 10-year. Implied volatility is expected to rise before Friday’s jobs report, with revisions showing a significant impact on the headline number. Hedging flows are likely to increase, leading to a rise in implied volatility.



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