NFP up on Friday
Likely the economic event with the most flawed name, it is also the economic report with the highest impact on the markets and market traders. The Non-Farm Payroll Report commonly known as the NFP report, measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative or bearish for the USD. Simple and straight forward.
It is also a simple and straightforward trade to set up and execute. We need to keep our wits about us as we can mis-execute. This caveat exists for all trade entries, but there is an added fold here because of the 2 different types of pairs: USD on the left and USD on the right. We want to pre-set six currency pairs on our platform. We do this by opening 6 “cubes” on the Alvexo platform. They are AUDUSD, EURUSD, GBPUSD, USDJPY, USDCHF and USDCAD. They are laid out in this order for a reason: To assist in keeping those wits straight. When the report is released, (not like the amateurs and newbies who execute before the release), we enter the 3 buy orders and the 3 sell orders DEPENDING ON THE OUTCOME. In other words, release is positive, meaning close to or better than the expectation, then, to capitalize on what should be the strengthening USD, the first 3 pairs are sell/put and the second 3 pairs are buy/call. That is the part that requires keeping your hand steady and your eyes on the screen. The opposite actions are required should the report release negatively.