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More downside bets on Aussie dollar

David Russell (david.russell@optionmonster.com)

The bears are keeping their sights set on the Australian dollar.

optionMONSTER's Depth Charge monitoring system detected the purchase of 2,200 July 90 puts on the CurrencyShares Australian Dollar Trust for $1.10. An equal number of July 93 puts were sold at the same time for $2.26, but volume was below open interest at the strike.

This suggests that an existing downside position was closed in the July 93s and rolled to the lower strike. The investor collected a credit of $1.25 in the process and remains exposed to further downside in the fund. (See our Education section)

The FXA is down 1.38 percent to $91.89 in morning trading and has lost 12 percent of its value in the last three months. Aussie has been going straight down recently because of slow growth in China and as weak demand for commodities drags on the economy Down Under. The fund also appears to be breaking long-term support around $93, which could make some traders think it will continue to fall.

Total option volume in the FXA is 2.5 times greater than average so far today, with puts outnumbering calls by 17 to 1.

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