Have you heard of NFP or Non Farm Payroll whispered among forex forums?
About how caution should be employed as it is coming?
This IS a good advise.
I won’t explain myself what NFP is as Investopedia has a good explanation of it which i quote here “
A statistic researched, recorded and reported by the U.S. Bureau of Labor Statistics intended to represent the total number of paid U.S. workers of any business, excluding the following employees:
– general government employees
– private household employees
– employees of nonprofit organizations that provide assistance to individuals
– farm employees
This monthly report also includes estimates on the average work week and the average weekly earnings of all non-farm employees.
Investopedia explains Non-Farm Payroll
The total non-farm payroll accounts for approximately 80% of the workers who produce the entire gross domestic product of the United States. The non-farm payroll statistic is reported monthly, on the first Friday of the month, and is used to assist government policy makers and economists determine the current state of the economy and predict future levels of economic activity. “
Looking at this we can see that it is indeed an important piece of information. Volatile moves of 100 – 200 pips within minutes have been known to happen for the EUR/USD.
If you are a scalper or simply don’t have evergreen SLs of 200pips or more, you WILL be taken out.
Yesterday was a NFP day and i have extracted the chart from the onset to an hour later.
Big moves you will notice and it is a ONE MINUTE chart.
The first minute would have easily taken out SLs on both side of the trade.
I stay out of NFPs. Always.
Remember, usually very first Friday of the month.