Market Overview

Building Approvals Report From Down Under In Australia Present A Trade Opportunity

Share:

On Tuesday, March 31 at 8:30 PM ET, the Australian Bureau of Statistics releases the latest numbers in the change of new building approvals issued.

Construction causes a rippling effect throughout the economy being a huge job creator and from builders purchasing services.

If the actual number released on new building approvals issued is greater than forecast then its good for currency.

Market Reaction After Report from Last 24 Months Analyzed

Apex Investing analyzes the market moves after news events like these going back 24 months. A consistent move in the market is what is looked for.

The average move for this trade was found to be 30 pips in the AUD/USD. It was found that the market tends to make its move and then pulls back. For this kind of trade an Iron Condor strategy is recommended using Nadex spreads.

You can enter as early as 6:00 PM ET for a 11:00 PM ET expiration looking for a profit potential of $30 or more. To set up the Iron Condor you sell the upper spread with the floor being where the underlying current market is trading.

Then buy the lower spread with the ceiling where the underlying current market is trading. To find an Iron Condor with a profit potential of $30 or more you want to buy and sell both sides for at least $15 or more.

Then at expiration, the closer the market settles to the middle of the spreads the more you profit.

Market Can Move 60 Pips For A 1:1 Risk Reward Ratio

This strategy is specifically for neutral moves in the market where the market will take off and then pull back and it is unknown which direction the market will go. It also has a long distance to break even and for a 1:1 max risk reward ratio.

For this setup if you bought and sold both sides for $15, then the market could move 30 pips in either direction and the trade would be break even; or the market could move 60 pips in either direction and remain there until expiration, and that would be a 1:1 max risk reward ratio. 

However, it was found after 24 reports that it averaged a 30 pip move and pulled back. If you'd like to find out more about trading Nadex and scheduled news events you can visit www.apexinvesting.com.

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

Posted-In: apexinvesting binary binary charts binary options binary scanner binary signalsBinary Options Options

 

Related Articles

Book A Demo
Learn How You Can Succeed In The Market With Benzinga Pro

Fastest Market News

Real-Time News Alerts

Customizable News Filters

Book A Demo

Bank of America Downgrades Melco Crown Entertainment To Underperform

Would An Intel-Altera Merger Be Good For Shareholders?