So Many Ways To Take An Economy's Temperature

The working, not working, collecting unemployment, cost of labor and bonuses; these are just a few things to track, among other data, to get a read on the health of an economy.

This week on Wednesday, August 12, 2015, the Office for National Statistics in Great Britain will release three reports that track just that information.

• Average Earnings Index
• Claimant Count Change
• Unemployment Rate

Amazing Increase For Wage Earnings

The last Average Earnings Index, which is a measure of price change for labor including bonuses paid by businesses and government, was a very impressive increase of 3.2% for the three months through May of 2015. The Office for National Statistics announced that was the fastest increase since early 2010!

While 3.2% was below the forecast 3.3%, it was still a significant jump. The Claimant Count is the change in the number of people claiming unemployment benefits during the previous month. The last report came in at 7K while this report is forecast for only 1.4K. This is a less significant report compared to the Average Earnings Index and viewed as a lagging indicator.

The Unemployment Rate, while also viewed as a lagging indicator, rose 5.6% and more than what was forecast at 5.5%. Why the average earnings is going up, while the unemployment rate is also going up was explained away by the Office Of National Statistics statistician Nick Palmer, “It’s possible that the rate of improvement in the labor market that we have seen over the last three years may have eased off, though it’s much too early to be certain.”

Trade Can Be Placed The Night Before

Traders can place a trade with the release of these reports. Using Nadex GBP/USD spreads you can set up a straddle strategy. This is a strategy that is just as it sounds, it actually straddles the market. To enter you would buy an upper spread and sell the lower spread. The floor of the upper spread would be where the ceiling of the lower spread is and be where the market is trading at that time.

Since they are released in the middle of the night for US traders at 4:30 AM ET, this setup is recommended to be placed at 11:00 PM ET the night before, on Tuesday evening, for 7:00 AM ET expirations. Your straddle should have a max risk of $40.

It’s important never to force a trade. Sometimes there may not be the spreads available to meet all the requirements for the trade strategy recommended above. In that case, do not take the trade. There are numerous news event trades every week and month. If a trade isn’t coming together for you, it’s best not to place the trade and wait for the next and better entry.

For a full news calendar of events to trade along with strategies go to www.apexinvesting.com.

Nadex spreads and binaries can be traded from 49 different countries.