FxWirePro: EUR/AUD tests trendline support at 1.5599 – put ratio spread for swing trading

The uptrend that has been gradually prolonging from last three months has taken one step ahead to break trendline resistance, it looks like the pair has set up a new stage for its bull run as you can make out from strong bull candles with volume confirmation with all leading technical oscillators are positively converging.

Why ratio spread: This is an income strategy. You are looking for a net credit if the stock stays within a range or rises. 

Execution: EURAUD is currently trading at 1.5753. Short two lots of next month OTM strike puts.

Buy one deep OTM strike put of the same expiry.

Advantage: This position will be profitable if the EURAUD stays within a range.

Risk/Reward Profile: There is unlimited risk in this position, with capped reward.