Get Ready To Trade On Durable Goods News

US Core Durable goods and Durable Goods Orders are due out this week at 8:30 AM ET, Thursday, January 28, 2016, by the Census Bureau and they are leading indicators for production. Rising purchase orders are a clue to traders that manufacturers are increasing their activity to fill orders. These reports can create market conditions good for trading with Nadex EUR/USD spreads and an Iron Condor strategy.

The Iron Condor strategy involves trading two spreads, one on either side of the market. A spread allows you to trade a range of the market and has a floor and a ceiling, which you can’t win or lose past. With the Iron Condor setup, you have two ranges of the market you can trade. The first spread is bought below the market with the ceiling being where the market is trading at the time and the second spread is sold above the market with the floor being where the market is trading at the time.

Nadex is a US based exchange and regulated by the Commodities and Futures Trading Commission. With Nadex EUR/USD spreads, each pip the underlying EUR/USD moves is worth $1. This recommended trade strategy is based on analysis of market reaction from the last 12 - 24 reports. It was found that the market tends to make a move and then pull back or it can just range. The Iron Condor strategy with a lower buy spread and an upper sell spread works well for just that kind of market movement.

For this Iron Condor, you want spreads that will have a potential profit or reward of $30 or more between the spreads. Essentially, you are buying the lower spread below the market, and you are selling the upper spread above the market. If the market doesn’t make much movement and ends up right where it started between your spreads, then you will make max profit when the spreads expire. If the market moves in one direction, then one side of your trade may profit first. You can leave the other spread on, and the market may pull back, and then that side could profit as well.

Using the spread scanner, you can quickly scan through the available spreads and easily determine the right spreads for your trade. Below is an example of the spread scanner with Nadex EUR/USD spreads listed down the center. The risk/reward potential is then listed to the outside of the spreads: on the left if you are selling and on the right if you are buying. You want to find EUR/USD spreads with the right floor and ceiling parameters as mentioned above and with each spread having around $15 reward potential.

To view image click HERE.
EUR/USD
Since the report comes out at 8:30 AM ET, you can enter the trade at 8:00 AM ET for 10:00 AM ET expiration. You can trade more spreads if you want, just be sure to have the same number of spreads on both sides of the trade. With this setup, the market can move 60 pips up or down and your trade is still within a 1:1 risk reward ratio. The market can move 30 pips up or down and the trade is break even. The closer the market is between your two spreads at expiration, the greater your profit.

To access the spread scanner for free go to www.apexinvesting.com. There you will also find free education on trading Nadex binaries and spreads as well as futures, forex and CFD’s.