Trading the Non-Farm Payroll (NFP) Report

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Traders anticipate non-farm payroll on the first Friday of the month as one of the biggest market movers of the entire month. This is true regardless of whether you trade stock indices, precious metals, crude oil or foreign exchange; the NFP release can lead to a volatile day. Currently, more notice is given to the NFP number due to its implications of the overall economic posture, as there is great speculation concerning potential interest rate action from the Fed.

On non-farm payroll day, traders face the particular challenge of anticipating of the market response to the NFP number. The market will often see false breakouts occur before the market settles on a direction for the day; and if a trader is attempting to trade an instrument based on a viewpoint of whether the NFP number will be a hit or a miss, often times currencies, equities and gold may react differently than anticipated. Sometimes the markets that we expect to drop on a missed NFP payroll number will actually rally higher, or markets that usually benefit from a disappointing NFP may actually trade lower.

Fortunately, traders have an opportunity to trade the actual non-farm payroll number itself, using CFTC-regulated binary options based on the actual NFP release, without having to anticipate the market reaction. Major banks have forecast a consensus of betweenandjobs to be created. For both examples, we will refer to the two order ticket images below.

In this binary options strategy, each leg has its own risk and profit potential when traded individually, but a different risk vs. These are the individual risk and profit potentials if you traded these options singly. Traded together, at least one of the legs would have to be successful, which limits your risk. Traded together, you again have a higher probability of success as well as a better return and reduced risk.

These are a just two examples of how to trade the NFP jobs release. Regulated, exchange-traded binary options are opening up new possibilities for both new and experienced traders with binary options. Binary options strategies offer the ability to trade based on multiple economic events, equity indices, currencies and commodities. Davin Blythe FairValue Trader has been a full time options trader since and has actively traded binary options since The information contained above may have been prepared by independent third parties contracted by Nadex.

In addition to the disclaimer below, the material on this page is for informational and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument on Nadex or elsewhere. Please note, exchange fees may not be included in all examples provided. View the current Nadex fee schedule. Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result.

No representations or warranties are given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk and any trading decisions that you make are solely your responsibility. Trading on Nadex involves financial risk and may not be appropriate for all investors. Past performance is not necessarily indicative of future results.

Nadex contracts are based on underlying asset classes including forex, stock index futures, commodity futures, cryptocurrencies, and economic events. Trading can be volatile and investors risk losing their investment on any given transaction.

However, the design of Nadex contracts ensures investors cannot lose more than the cost to enter the transaction. Nadex is subject to U. Fill out our online application in just a few minutes.

Exchange fees not included in calculations. Get Started Fill out our online application in just a few minutes. Open an Account Trade all the markets you love.

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On the first Friday of every month, the Nonfarm Payroll reports are released at 8: The report measures the change in employment during the previous month, excluding the farming industry. One trade has a currency in the numerator of the currency pair. The next trade has the same currency in the denominator. Buy them both or sell them both. One trade is likely to be profitable while the other trade is not. On Friday, June 3 at 8: Just before the news release, two trades were placed:.

Once again, one trade will likely win while the other trade loses. Not a chance of exiting this trade for a partial loss. The worst case scenario? In that event you may wish to consider exiting your positions to minimize losses, if possible. Aliquam lobortis magna accumsan erat fermentum, at dapibus neque maximus. Fusce lacinia rutrum justo ut hendrerit. Phasellus mattis vulputate erat. Suspendisse libero nibh, fermentum vitae consectetur id, placerat eget dui.

Mauris non libero suscipit, ullamcorper enim quis, ultrices ipsum. The information contained above may have been prepared by independent third parties contracted by Nadex. In addition to the disclaimer below, the material on this page is for informational and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument on Nadex or elsewhere. Please note, exchange fees may not be included in all examples provided. View the current Nadex fee schedule.

Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representations or warranties are given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk and any trading decisions that you make are solely your responsibility. Trading on Nadex involves financial risk and may not be appropriate for all investors. Past performance is not necessarily indicative of future results.

Nadex contracts are based on underlying asset classes including forex, stock index futures, commodity futures, cryptocurrencies, and economic events. Trading can be volatile and investors risk losing their investment on any given transaction. However, the design of Nadex contracts ensures investors cannot lose more than the cost to enter the transaction. Nadex is subject to U. Fill out our online application in just a few minutes. Just before the news release, two trades were placed: Get Started Fill out our online application in just a few minutes.

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