By Darrell Martin
At 4:30 AM ET, Thursday, December 14, the Office for National Statistics, UK, will issue a four reports, which could impact trading. These reports are of importance ranging from medium and high. They concern subjects related to Retail Sales. These reports measure changes occurring with the United Kingdom’s economy in multiple ways. Consequently, these reports could affect the market and provide a trade setup.
News reports often cause movement and volatility in the market. Reactions to such news generally start with movement in the market, followed by a pullback. Even so, the direction of movement remains to be seen.
Designing a trade to collect premium while perhaps making a profit regardless of market movement is possibly to the trader’s advantage. The Iron Condor setup makes use of two Nadex GBP/USD spreads. A spread is bought below the market and another spread is sold above the market concurrently. At the time of entry, the ceiling of the bought spread ought to connect with the floor of the sold spread and be where the market is trading.
The market may fluctuate up or down and pull back toward the center between spreads with this strategy, but both spreads can profit as time expires. This becomes a collection of premium. Risk can further be maintained to remain a realistic 1:1 risk reward potential. Nonetheless, there is no more risk outside the floor and the ceiling of spreads.
This trade can be entered on Wednesday at 11:00 PM ET, the night before utilizing the 7:00 AM ET expiration. Putting a trade on like this is perfect for nighttime traders, but also for traders who like the ease of sleeping through a trade, knowing risk is capped and minimal. This is a valuable trade to demo to get more experience with market reactions about news releases and Nadex spreads.
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