By Darrell Martin
Even though the release of the Swiss Producer Price Index (PPI) is at 3:15 AM ET, Thursday, April 16, in the middle of the night, the USD/CHF can still be traded at a reasonable hour. Using Nadex Spreads and setting up an Iron Condor as early as 11:00 PM ET, Wednesday evening for a 7:00 AM ET expiration. You can set up the trade, leave it for expiration, and go to bed. The strategy for this trade is to find spreads for an Iron Condor setup with a profit potential of $35 or more. Buy the lower Nadex USD/CHF spread with the ceiling where the current underlying market is trading and sell the upper spread with the floor where the current underlying market is trading. For this scheduled news event, the average move over the last 24 months was found by Apex Investing to be 35 pips. The PPI measures a change in the price of goods and services sold by manufacturers. It is a leading indicator of consumer price inflation, which makes up the majority of overall inflation. The USD/CHF Tends To Move Then Pulls Back If, when setting up the trade, the spreads available don’t allow for at least a $35 profit potential, then there is no trade. There needs to be at least that much implied volatility in the pricing for a possibility of a profitable trade. After the Swiss PPI has been released, the market tends to react and typically pulls back, rather than just continuing in the same direction. The closer the market pulls back to the center between your Iron Condor spreads, the greater your profit. Leaving your spreads on until expiration gives the trade plenty of time to play out and for the market to return. The Swiss PPI is released monthly. Therefore, this is a trade setup that can be traded monthly after this report. If you are interested in learning about more news trades and strategies to trade them visit www.apexinvesting.com, a service of Darrell Martin.