NFP Friday Is Here: Check Out The Many Possible Ways To Trade It

Friday, January 8, 2015 at 8:30 AM ET, Nonfarm Payrolls will be released telling the change in the previous month of the number of employed people, excluding farming. This report can cause movement in many markets so you need to be aware of it, at the very least, if not trade it for profit opportunities.

Two kinds of strategies using Nadex spreads are recommended for this news event. The first is an Iron Condor and the second is a Straddle. Nadex spreads allow you to trade long or short a range of the market and have a bottom and top or floor and ceiling, as they are called. You can’t lose or win past the floor or ceiling depending on your trade direction. It is simple to set up a Nadex account and takes little time with only $100 for a live account. Be sure to demo trade and get it down before live trading.

The report is released at 8:30 AM ET, so you can enter as early as 7:00 AM ET for 3:00 PM ET expirations. For an Iron Condor, buy the lower range spread below the market with the ceiling where the market is trading at the time and sell the upper range spread above the market with the floor where the market is trading at the time. Then, you also want your trade to have the minimum profit potential. Below is a chart listing all possible markets along with the ideal minimum profit potentials for your trade setup. Most of the movement happens in the first 15 minutes, so it is recommended to go for as much time as possible to give the market time to retrace. One side of your trade will most likely profit and then as it retraces and pulls back, the other side will profit.

To view image click HERE.
275k_image1

The next strategy you can set up for is the Straddle. The Straddle is a little different. With this strategy, you do the opposite of the Iron Condor. You buy a spread above the market with the floor where the market is trading at the time and sell a spread below the market with the ceiling where the market is trading at the time. When setting up a Straddle, you want it based on maximum risk. Below is a chart showing the market and the maximum risk for the specific straddle. It also shows at how many pips in either direction to take profit. With this setup, one side of the trade will lose but the other side will win and cover the loss for the other side as well.

To view image click HERE.
275k_image2

These are the ranges expected or minimum profit in pips. If you can pull off a straddle taking profit for 1:1 from the market price up to the expected move, entering at 7:00 AM ET for expirations at 9:00 AM ET, 10:00 AM ET, or 3:00 PM ET, that is acceptable and a better trade in many cases. Make sure to use limit take profit orders entered immediately after filled. Also, be very aware of deviation levels and take profit before the deviation level is hit. Remember, 90 percent of the time the biggest move has happened in the first 15 minutes.

After the Iron Condor and Straddle action takes place and the markets settle down, often the market will remain flat after 11:00 AM ET to 3 PM ET and on a Friday. This can be a great time for Butterflies using Nadex binaries.

To learn more on how to trade the news and for a full calendar of events along with strategies to trade them go to www.apexinvesting.com. There you will find free education on how to trade Nadex as well as futures, forex and CFDs.