FxWirePro: Shorting AUD/JPY strangles best suitable for range bound trend (91.309-91.915)

On daily charts we observed from last fortnight or so the pair did not break on a closing basis the range of 91.309 on downside and 91.915 on upside. Technically speaking the leading oscillator RSI (14) has been stagnant but converging according to the price fluctuations.

Rationale: There are no significant market drivers for both currencies until end of this week that propel the pair to any extreme directions.

Hence, we think the price to remain in this bandwidth; bulls make profits from uptrend and so does the bears in downswings. But this is how successful traders can get benefitted from even sideway trends.

So our recommendation contemplating current fundamental as well as technical reasoning would be Shorting 4D (-0.5%) Out-Of-The-Money put and simultaneously sell 4D (0+5%) Out-Of-The-Money call option for a net credit.

There would be 2 break-evens points for the short strangle execution as shown below,

Upper Breakeven Point = Exercise Price of Call + Premium Received
Lower Breakeven Point = Exercise Price of Put - Premium Received

Highest returns for this position is achievable only when AUDJPY exchange price is ticking between the strike prices of the options sold at maturity. At this price, both options expire worthless and the options trader gets to keep the entire initial credit taken as profit.