Market Overview

Tips On How To Trade Various News Reports Coming Out In Europe Tuesday

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Reports on Europe are scheduled to be released early Tuesday morning at 5:00 AM ET.

Fortunately though, this trade tip is for placing your trade the night before at 11:00 PM ET Monday.

The beauty of this trade is that it can be set up and placed, then you can go to sleep and wake in the morning to watch it expire.

Various reports in Europe include:

  • CPI Flash Estimate - a change in the price of goods and services purchased by consumers,
  • Core CPI Flash Estimate - same as the above, however, excludes food, energy, alcohol and tobacco.
  • Unemployment Rate - percentage of total work force that is unemployed and actively seeking work during the last month.

All of these reports are released monthly and affect currency. If the actual numbers come out greater than forecast, it is good for currency.

For the CPI reports Eurostat does the release and bases the information from 13 euro area member states that report early data. There is a Flash and a Final CPI report. The Flash is extremely early being released two weeks before the Final and has more impact.

The reports are significant due to consumer prices accounting for much of overall inflation which is important to currency valuation.

Rising prices also lead to the central bank possibly raising interest rates. The Unemployment Rate is an indicator of overall economic health and can influence consumer spending.

24 Months Analyzed

The EUR/USD has been analyzed over the last 24 months by Apex Investing after the reports were released, and it was found to have moved an average of 35 pips and then return.

A recommended strategy for this move is an Iron Condor or neutral strategy. This kind of strategy is good for profiting when the market moves but pulls back and does not take off and continue in one direction.

Use Nadex Spreads

To set the trade up using Nadex Spreads buy a EUR/USD lower spread and sell an upper spread with a profit potential of $35 or more. Choose a lower spread with a ceiling where the underlying market is currently trading and an upper spread that has its floor where the underlying market is currently trading.

As stated in the beginning, you can enter at 11:00 PM Monday night and then leave your trade on until expiration at 7:00 AM. After the reports are released the market will react and make its move. The closer it pulls back to the center of your spreads, the higher your profit, with max profit being when the market is right between the spreads at expiration. To learn more about how to trade news events and strategies to trade them, you can visit www.apexinvesting.com.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

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