How to Trade Futures or ForexEarnings season is in full swing, and with any large news announcement comes the possibility of fast market moves and volatility. If you’re a trader looking to capitalize on earnings announcements then binary options provide a trading opportunity with defined risk and exposure for after the closing bell earnings announcements.

Amazon announced earnings after the closing bell last night at 4:01 p.m. ET, and while they beat on EPS of $1.54 vs. $1.35 expected, they missed on the all-important total revenue coming in at $43.74 billion vs. $44.68 billion expected. Amazon also missed on their web services revenue with $3.536 billion vs $3.6 billion expected, while adding guidance for the future that disappointed as well. Shares of Amazon sank quickly after the news, also bringing down the Nasdaq 100.

Amazon represents almost a 7% weighting in the Nasdaq 100. The US Tech 100 on the Nadex Exchange is based on the CME E-mini Nasdaq 100 Index Futures, which trade until 4:15 p.m. ET. Because Amazon announces their earnings at exactly 4:01 p.m. ET, this leaves plenty of time to trade on the Nadex Exchange with exposure to the earnings announcement just after the closing bell.

Here we see a chart of the indicative US Tech 100 Index as of 4 p.m. ET yesterday, just seconds before Amazon was about to release their earnings. Along the right axis are some of the available daily binary options, which expire at 4:15 p.m. ET, which leaves about 14 minutes until expiration.

Whether you’re bullish or bearish, or just looking for volatility in either direction, there are a multitude of options for investors and traders, all of which provide defined risk.

Fast forward a bit and here is that chart of the same indicative index after Amazon announced their earnings and the market reacted.

The indicative index was trading at 5,141.88 just prior to AMZN’s earnings, and then closed at 4:15 p.m. ET at 5,131.40 moving more than 10 full points within that time. The next time you’re looking to trade earnings for large stocks that could move  indices, consider binary options as a possible trade with defined risk.

Now is a great time to open a demo account with Nadex to see for yourself how their products react to underlying market moves.

Nadex Risk Disclaimer
· Trading on Nadex involves financial risk and may not be appropriate for all investors. The information presented here is for information and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument on Nadex or elsewhere. Any trading decisions that you make are solely your responsibility. Past performance is not indicative of future results. Nadex instruments include forex, stock indexes, commodity futures, and economic events.
· Nadex binary options and spreads can be volatile and investors risk losing their investment on any given transaction. However, the limited-risk nature of Nadex contracts ensures investors cannot lose more than the cost to enter the transaction. Nadex is subject to U.S. regulatory oversight by the CFTC.