Fives Reports Scheduled For Release, One Trade Strategy

A variety of reports come out for the US at 8:30 AM ET, Wednesday, November 25, 2015. They include:

• Core Durable Goods Orders
• Durable Goods Orders
• Core PCE Price Index
• Personal Spending
• Personal Income

When the above reports release, the market tends to make a move but also pull back. It doesn’t necessarily have a direction it usually moves in, so an Iron Condor neutral strategy can work well for this market scenario.

Durable Goods measures the change in total value of new purchase orders placed with manufacturers for durable goods giving a read on production. If orders go up then production will increase. Core Durable Goods Orders will give a measure on the hard products, things that stay around more than 3 years but not including transportation items. Things like auto and airplane orders are more volatile and can skew the report. The Core PCE is rumored to be the Federal Reserve’s favorite inflation measure, as it is the change in price of goods and services only targeted toward and consumed by individuals, excluding food and energy.

When trading this news event, the market tends to move but not necessarily as much as could be expected with five reports. Instead, the market usually pulls back or sometimes even ranges. Based on this kind of market movement, an Iron Condor is the recommended strategy using Nadex EUR/USD. Spreads allow you to trade the market within a range. They have a floor or bottom of a range and a ceiling or top of a range within the market you can trade long or short. You can’t win or lose past the floor or the ceiling depending on which direction you trade the spread.

For this setup you want to buy a lower range spread below the market but with the ceiling where the market is trading at the time and you want to sell an upper range spread above the market but with the floor where the market is trading at the time. To easily find the spreads with the right ceiling and floor parameters, open the spread scanner, which you can find on www.apexinvesting.com. Below you can see an example of the screen scanner with Nadex EUR/USD spreads displayed.

To enter at the right time at the right price you want your reward or profit potential to be $25 or more combined. Don’t enter until you see that your chosen spreads have a reward potential of around $12 - $13 or more for each of your spreads, so combined you’ve got $25 or more in potential profit. This may take a little time or may not happen for this trade, in which case don’t force the trade.

Depending on your exact entries, the Iron Condor provides plenty of room for the market to move without your trade losing. For this trade, the market can move 25 pips up or down and your trade will be break even. For a 1:1 risk reward ratio, the market can move as much as 50 pips up or down. Max profit will be the market expiring right between your spreads, right around where the market was when you entered your trade.

To learn more on how to trade the news, Nadex spreads or futures, forex and CFDs you can visit www.apexinvesting.com for free education. Nadex is a CFTC regulated exchange based in the US and can be traded from 49 different countries.