Analysis: The selling pressure on the US dollar has weakened, and there are not many traders hedging against the risk of the US dollar falling.

The US dollar may indeed have fallen today, but the options market reflects that there are not many traders hedging against the risk of a lower US dollar. The dollar has given back its previous gains, with the Bloomberg US Dollar Spot Index seeing its largest increase in a month on Monday. Although the cost of shorting the dollar is still higher than the cost of going long on the dollar, the cost of these put options has decreased. The one-week and one-month risk reversal indicators have dropped to their lowest level since early April.