The following article discusses two option strategies; Bull-spread to trade a rising trend and long Strangle to trade a market move in either direction.
A Bull spread may be used to take advantage of a rising price. It is created through buying a Call option and at the same time selling a Call option at a higher strike. It has the benefit of limited loss and no risk of stop-out. It also has limited profit, the effect of limiting profit (through selling a Call at the same time) reduces the premium paid to enter the position.
The example below is to buy a 7-day Call with 1.1314 strike (at-the-money) and sell a Call at 1.1427 (out-the-money). Both options have amount to trade set to 100,000 EUR. It costs 554.93 USD premium to buy this position. If EUR/USD rises profit will grow until the pair reaches 1.1427 and above. If EUR/USD does not rise by expiry the loss is limited to the premium paid. Check 'Scenarios' for more details.
You may alter the strike rates to match your outlook.
On the other-hand, if you expect EUR/USD to fall you may trade a Bear spread which involves buying an ATM Put and selling an OTM Put at the same time.
A long strangle involves buying a Call and Put (both OTM) at the same time to take advantage of a large price move in either direction.
The example below is buying a 7-day, Call at 1.1373 strike (+0.5% above market) and buying a Put with 1.1259 strike (-0.5%), both have amount to trade set to100,000 EUR. The cost to buy this position is 1,470.93 USD. As the market moves in either direction the position's payout grows. Check 'Scenarios' to see profit/loss and break-even points.
You may chose the strike rates depending on your outlook.
On the other-hand, if you expect EUR/USD to become less volatile you may sell a Call and Put at the same time and if the pair remains within a certain range until the position expiry the strategy may payout.