Consistent Market Reaction To News Can Payoff With The Right Strategy
When trading, it’s imperative to be aware of the news, especially any financial news that is scheduled for release. Those events can move the markets, though it’s never known how the markets will react.
Research can be done by looking back to find consistency or an average move over a certain period of releases. This information can help one find a strategy to trade the news event.
Looking over the Apex news trading plan calendar for Monday August 29, there are three news events that can be traded. All three events in green call for an Iron Condor strategy.
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Iron Condor Be Aware of These Events Crop Report News
When trying to find evening trades, Australian news can provide some possibilities. Building Approvals for Australia will be released at 9:30 p.m. ET. An Iron Condor strategy, using Nadex AUD/USD spreads, can lead to profit should the market make a move and pullback, which tends to happen just after this event.
To set up for this strategy, one could buy a spread with the ceiling where the market is trading at the time and sell a spread with the floor where the market is trading at the time. Each spread should have a profit potential of $15 or more for a combined $30 profit potential.
Be sure to enter stop limit orders where the market would be if it moved 60 pips up or down. At those points, the trade would be at a 1:1 risk reward ratio. The breakeven points are where the market would be at 30 pips up or 30 pips down. For maximum profit, the market will have pulled back from its move and be right between the two spreads at settlement. Should the market settle anywhere in between the two breakeven points, the trade will make some profit.
For free access to the Apex news trading plan calendar and day trading education, visit Apex Investing.
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