Trade Various U.K. News Reports With Ease

The UK Manufacturing Production, Industrial Production, and Goods Trade Balance will be released Tuesday morning at 4:30 a.m ET, providing a GPB/USD trade opportunity as early as 11 p.m. ET Monday evening. Previous market moves in reaction to this news have been around 35 pips. 

The opportunity provides an opportunity to use an Iron Condor strategy with two Nadex GBP/USD spreads expiring at 7:00 a.m. ET. One could buy one spread below the market with the ceiling where the market is trading at the time, and sell one spread above the market with the floor where the market is trading at the time. Each spread should have a profit potential of $17 or more for a combined profit potential of $35. The desired outcome for this strategy is for the market to settle between the two spreads for max profit.

Settling between the two spreads is possible since the market tends to react to the news, make a move up or down, and pull back. The closer the market pulls back to where it was at the time of entry between the two spreads, the higher the profit will be at settlement.

There should also be stops set up in the event the market takes off and doesn’t pull back. To determine where to place the stops, just double the profit potential of the Iron Condor. For this example, the combined profit potential is $35, so the stop would be 70. Stops should be placed 70 pips above and below from where the market is at entry.

For this Iron Condor, simply find GBP/USD spreads expiring at the designated time, with approximately $17 in the reward column, verify the ceiling and floor parameters, open a ticket, confirm maximum profit potential, and enter the trade. Set the stops up directly after placing the trade. For a glimpse of the Apex spread scanner layout, see below screenshot.

To view a larger image click HERE.

Free day trading education and free access to the spread scanner can be found at Apex Investing.