ECB Release Of Minimum Bid Rate Offers An Iron Condor Trade


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By Darrell Martin

Markets have slowed down and the S&P has had a pull back since its rally after Trump’s election. That being said, unemployment in Europe is unchanged and industrial output news was good. The European Central Bank is expected to leave interest rates unchanged during the release of the Euro Minimum Bid Rate set to come out Thursday, January 19, at 7:45 AM ET.

The event can be traded using an Iron Condor and going for a minimum profit potential of $25 or more. To set up the trade, buy one spread below the market and sell one spread above the market. The ceiling of the bought spread should meet the floor of the sold spread and be where the market is trading at the time.

The spread scanner makes trading this news strategy easy. Entry can be as early as 6:00 AM ET for an 8:00 AM ET expiration. Use the filter features to bring up Nadex EUR/USD spreads with the 8:00 AM ET expiration. Each spread listed will show a red and green bar along with an amount for the risk reward if sold or bought. Find the spreads with around $12 - $13 profit potential or more. Check if the ceiling/floor parameters match then use the ticket icon to enter the trades. For a view of the spread scanner, see the image below.

To set up stops for an Iron Condor, simply double the total profit potential. If the combined profit potential for this trade is $25, then double that is 50. Stops should be placed 50 pips above and below from where the market was at entry. At those points, the risk reward ratio will be 1:1.

The breakeven points for an Iron Condor are the combined profit potential. For this trade, that would be around 25 pips up or down from where the market was at entry. If the market settles anywhere in between those two points, after a pull back from a move in reaction to the news, the trade will profit. When the market settles right between the two spreads is max profit.

Free education for day trading and trading the news, as well as free access to the spread scanner is available on www.apexinvesting.com.