How To Trade The Monthly Swiss PPI Numbers
Each month at 3:15 AM ET, the Federal Statistical Office for Switzerland releases its Producer Price Index, which measures the change in the price of goods and raw materials purchased by manufacturers. This is a leading indicator for inflation, which would affect consumer spending.
It’s released at 3:15 AM ET in the middle of the night; however, trading Nadex spreads, using an Iron Condor strategy, one can enter as early as 11:00 PM ET, Monday, the night before.
Based on market analysis done over the past 12 - 24 months, it was found after these reports are released that the market tends to move and then pulls back or will just stay in a range. An Iron Condor strategy works well with this kind of market movement.
To set up the trade, one can buy a lower Nadex USD/CHF spread below the market but with its ceiling where the market is trading at the time. Also, they can sell an upper Nadex USD/CHF spread above the market but with its floor where the market is trading at the time.
The market could move 70 pips up or down for a 1:1 max risk reward ratio.
© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.