BUZZ-COMMENT-Huge option hedging can magnetise EUR/USD 1.0400-50

Feb 5 (Reuters) - Traders managing FX volatility through options often hedge their currency exposure with cash, which can influence and anchor the spot market near key strike levels as expiries approach.

Soon-to-expire FX option strikes typically generate the biggest hedging flows and since EUR/USD's recovery from Monday's 1.0125 low, it finds itself within a 1.0400-50 zone, where the bulk of soon-to-expire FX option strikes reside.

There are 815 million euros of 1.0400 strikes and a massive 2.2 billion euros of 1.0420-30 strikes expiring at the 10 a.m. New York cut/1500 GMT on Wednesday.

Thursday has over 4 billion euros expiring between 1.0400-15 and there are 1.7 billion euros of 1.0400 strikes expiring on Friday.

The biggest nearby EUR/USD strikes expiring next week are on Monday at 1.0400 for 2.5 billion euros and 1.0450-55 for 5 billion euros. Tuesday at 1.0400 for 1.7 billion euros and 1.0450 for 2.5 billion euros and on Friday at 1.0400 for 3.6 billion euros.

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