How To Trade The US Current Account

The US Current Account report will be released on Thursday, March 19, at 8:30 AM EDT by the Bureau of Economic Analysis. Part of this report is redundant in that it measures the difference in value between exported and imported goods and services. This is essentially the same information that is put out in the Trade Balance report. However, in order to pay for exports foreigners must buy US currency to execute the transactions in the US. That is the number that is important to traders who cause the EUR/USD market to move an average of 30 pips after this event, as researched by Apex Investing going back 24 months.

Look For A $30 Or More Profit Potential In The Setup

To capture some profit on this news event you can trade an Iron Condor strategy. Using Nadex EUR/USD spreads, a derivative of the EUR/USD underlying market, you can buy a lower spread and sell an upper spread. The lower bought spread should have its ceiling where the then current underlying market is trading and the sold upper spread should have its floor where the then current underlying market is trading, so that the ceiling and floor are the same. The Iron Condor should have a profit potential of $30 or more built into it. For example, you could buy the lower spread for $15 or more, and sell the upper spread for $15 or more, and the Iron Condor would have a profit potential of $30 or more. In addition, you can have more than one spread on each side as long as both sides have an equal amount of spreads.

Market Doesn't Have To Move To Make Max Profit

Enter as early as 8:00 AM EDT for an expiration of 10:00 AM EDT. The report comes out at 8:30 AM EDT however, the trade can be left on until expiration to give the trade time to profit. It's expected the market will make a move and then pull back. The closer it returns to the center of your Iron Condor between the two spreads the greater your profit. In fact, if you buy the lower for $15 and sell the upper for $15, the market could not move at all and you would profit on both sides for $30. For break even the market could move in one direction 30 pips and then for a 1:1 max risk reward ratio the market could move 60 pips in one direction. It's anticipated through research however, that the market usually moves an average of 30 pips and pulls back.

The advantages of the Iron Condor is that you have the opportunity to profit in neutral market moves, where the market will react but then pull back. At the same time should the market take off unexpectedly, it can make a significant move before there is a loss.

North American Derivatives Exchange or Nadex is open now to 49 countries for trading and it's easy to open an account. Also Apex Investing has a complete calendar of news events researched with recommended strategies for trading at www.apexinvesting.com.