By Darrell Martin
The Trade Balance of any country is important. It’s the difference between the imported and exported goods and the actual number is usually announced monthly, which is the case for Switzerland as well. Their Federal Statistical Office will announce their Trade Balance at 2:00 AM ET, Thursday, April 22, 2015. This makes for a trade opportunity, but not at 2:00 AM! Who wants to trade in the middle of the night? Few people, probably. Therefore, this trade setup is for the night before and can be left on until expiration. However, this trade uses Nadex spreads and Nadex can be traded from 49 different countries now.
Traders watch the trade balance as it can impact currency demand, production demand and domestic manufacturing prices. Currency demand is affected because foreigners must buy the domestic currency to pay for the nation’s exports. All of this can be good for currency if the actual is greater than the forecast.
Market Can Go Either Direction. Iron Condor Is Set Up To Potentially Profit
To trade this news event, an Iron Condor is recommended, because the market can go in either direction and the strategy could profit. This strategy calls for at least two Nadex spreads. Buy the lower USD/CHF spread and sell the upper USD/CHF spread. Enter this trade the night before at 11:00 PM ET Tuesday, April 21. The bought lower spread’s ceiling should be where the then current underlying USD/CHF is trading and the sold upper spread’s floor should be where the then current underlying USD/CHF is trading.
Market Can Move 60 Pips For A 1:1 Max Risk Reward Ratio
For this Iron Condor, look for a profit potential of $30 or more. If that seems low to you and you want to go for more, you can always trade more spreads. Just be sure to have the same number of spreads on each side. If the spreads available aren’t offering a profit potential of $30 or more for the setup, then there is no trade. With a profit potential of $30 or more on an Iron Condor, distributed evenly between each side, the market can move 60 pips in one direction for a 1:1 max risk reward ratio. However, it’s anticipated, based on past market response to this news report, that the market will move and then pull back. The closer the market pulls back to center between the spreads, the higher the profit, with max profit being at center. Apex Investing watches market reaction to numerous news events and has a news calendar for scheduled trade strategies. To learn more on how to trade the news, visit www.apexinvesting.com.