By Darrell Martin
If you find it difficult to trade during the week because of a busy work schedule Monday to Friday, then you can trade a news event Sunday evening. Scheduled news is continually released around the clock. Therefore, if during the daytime hours aren’t the opportune time for you to trade, evening news trades might work for you. These three reports, Net Lending to Individuals, M4 Money Supply and Mortgage Approvals are being released in the UK early Monday morning at 4:30 AM ET, February 29, 2016. Don’t worry- you don’t have to get up in the middle of the night! For this trade you can enter the night before, Sunday, as early as 11:00 PM ET for 7:00 AM ET expirations.
There are expiration times because the recommended strategy is for trading Nadex Spreads. Analysis has shown that these reports tend to move the market and then it pulls back, making an Iron Condor strategy a high probability strategy. You will buy a lower range Nadex GBP/USD spread with the floor below the market and the ceiling right at market or very close to it. At the same time, you will sell an upper Nadex GBP/USD spread with the ceiling above the market and the floor right at market or very close to it. You want your spreads to have a profit potential of $35 or more combined between the spreads.
This strategy is buying below the market and selling above the market. You want the market to stay in a range so both spreads will make some profit, or you want the market to move far enough for one side to profit, and then pull back so the other side will profit as well. Depending on your exact entries, with a reward potential of $35 or more, the market can move 35 pips up or 35 pips down and the market will hit your breakeven points. If the market moves past those points up or down, that’s when you can start to lose. However, for the market to hit the 1:1 risk/reward ratio points, the market would have to move up 70 pips or down 70 pips. You would place stop limit orders for managing risk at those points. Max profit is when the market is right between your spreads at expiration. Be sure to enter your stop limit orders for taking profit after you have entered your trade.
Realistic Risk Is Only $35
It may seem like there is much risk with having to pay max risk upfront to enter the trade. Remember, though, your realistic risk is only $35 based on exiting if the market hits your 1:1 max risk/reward ratio points. Also, with Nadex you cannot win or lose past the floor or ceiling depending on which direction you traded the spread. There are no margin calls; the risk is defined upfront and capped.
To easily find the spreads you need for the trade, look on the Nadex spread scanner designed for and by traders. It is available for free access with a free login at www.apexinvesting.com.
To learn more about how to trade the news, Iron Condor strategies or Nadex spreads and binaries, just visit www.apexinvesting.com. There you will find free education for day traders as well as a forum of 17,000 members strong. Nadex is a CFTC regulated US based exchange and can be traded from 48 different countries.
