What's The Fed Going To Do This Time? Getting Ready With Trade Strategies

FOMC is scheduled for the week ahead and the markets are readying. Oil seems to keep going down as global demand is falling, yet supply keeps coming. The forex markets misread the intentions of the European Central Bank; combine that with Oil’s activity and the Fed Funds Rate coming out this week, the forex markets seem to be lacking direction. Nevertheless, there are trades to be made, when the FOMC news comes out at 2:00 PM ET, Wednesday, December 16, 2015. Actually, the recommended trades get put on much earlier using Nadex spreads.

The Federal Open Market Committee meets, and then the Federal Reserve releases their Economic Projections four times a year, which includes inflation and economic growth information over the next two years. Scheduled eight times a year, the Federal Reserve releases a statement which investors analyze every word looking for clues on future votes regarding the Fed Funds Rate, which is also released. The reports together with the question and answer period at the press release of the statement can create volatility in the markets, making for many trading opportunities.

Using Nadex spreads, you can use the Iron Condor strategy. You want to buy a lower spread with the ceiling where the market is trading at the time and sell an upper spread with the floor where the market is trading at the time. The charts below show the market, the time to enter and the expiration time of the spread. For example, taking the first recommendation, entering at 11:00 AM ET for 3:00 PM ET expiration, buy a Nadex EUR/USD spread, and sell a Nadex EUR/USD spread for a combined profit potential of $50 or more, or approximately $25 profit potential each spread. To know where to exit, simply multiply your profit potential by two, i.e. 50 x 2 = 100. If you entered with a combined profit potential of $50 or around $25 per spread, the market could move 100 pips up or down and that is where your max 1:1 risk/reward ratio would be. That is where you want your stops and where to call the trade. One side of the trade may profit first and then the market could pull back for the other side to profit as well. Max profit happens when the market is centered between your spreads at expiration.

To find your spreads easily at a glance, use the Apex spread scanner available at www.apexinvesting.com. You must have a Nadex demo or live account and be logged in. Nadex is a CFTC regulated exchange located in the US and can be traded from 49 different countries. For more information and free education on how to trade Nadex binaries and spreads, as well as forex, futures, and CFDs go to www.apexinvesting.com.