FX traders could use a simple option to profit from a anticipated EUR/USD squeeze higher in coming sessions.

EUR/USD has closed back above the 1.0880 Fibo, a 61.8% retrace of the 1.0635-1.1276 (May-July) EBS rise, after three daily closes in a row below it.
This is a potential bear trap that is set when a market breaks below a tech level but subsequently reverses and is usually bullish.

The scope grows for a bigger EUR/USD recovery to the 1.1010 Fibonacci level, a 38.2% retrace of the 1.1276 to 1.0845 (July-Aug) drop, a break above which would likely lead to an even bigger rise.

FX traders wanting to profit from EUR/USD gains could buy a one-week 1.0910 EUR call option at a cost of 38 pips, priced with spot at 1.0902.
Profit potential is unlimited if spot is above the 1.0948 break-even point at the Aug.
29 expiry.
Losses are limited to the 38 pips premium paid.

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