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NFP! WHAT TO DO ?

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By: Adam Stone
May 2nd 2014 6:10am GMT, London UK
 
Today, Binary options, as well as literally every trader on the planet, is readying themselves for the release of the Non Farm Payrolls report. This report, NFP for short, is the single biggest economic indicator of the month and catches the eye of every trader in the market and for good reason. The NFP has a tendency to create large waves of price action for traders leading to massive profit potential. With GOptions’ ability to provide access to forex trading, there are now more ways to earn than ever before.

NFP with binary options 2-5-2014

The NFP report is expected to show a result in or around 210 thousand new jobs in the US market. This needs to be compared to the 192k created last month in addition to an unemployment rate of 6.7%. The markets are going to fall through the floor if the release of the unemployment rate ends up lower than 6.6%, which is the expected release rate. However, please note, these are 2 correlated yet independent jobs reports. On the one side, both indicators can show improvement or not. They can also be mixed. As such, it can get rather confusing and sometimes even impossible to react properly to the action in the markets based solely on the actual results.

The best course of action is to do a number of the following:
1. Prepare your trades in advance using binary options
2. Add hedge trades above and below the market for later expiry using later expiries or even ladder options (assuming liquidity allows access)
3. Use the forex trading to actually time a trade and get into the direction of the market

There are a few strategies for getting all this done. One popular method is to take 2 forex trades in opposing direction but with equal stop loss amounts. However, the take profit should be raised above this amount. The reason for this need is due to the whiplash effect seen often with the release of the NFP. Many times, the market will head strongly in one direction, only to head the exact opposite direction within seconds and sometimes with an even larger scope.

As such, binary options and forex traders can get into both trades prior to market action upon the release. We recommend doing this with 10 minutes or more prior to the release due to the fact that as we near the actual release time, liquidity will dry up almost completely, making it near impossible to place a trade.

Once the release hits, the Take profits, if timed and gauged correctly, will in fact catch. Keep them to a few tens of pips (not hundreds of pips) as the likelihood of a tsunami like move is low. We actually expect some strength and follow through with any move the market throws at us today after the release of the NFP. However, just be sure to take things with smaller trades and keep things very well monitored. Any loss of focus could lead to loss. Stay tuned for the move today.

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Adam Stone
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Adam Stone

As COO of GOptions, my first and foremost goal is to provide traders with the most up to date info from the markets. I have been trading the markets since 2004 and have been involved with stocks, binary options, and forex trading since then. I have had no formal market education and pride myself on a self taught approach to everything related to trading. I try to focus though on both the technical and fundamental aspects related to each trading day and bring forward the most important aspects of risk/reward in the market.
Adam Stone
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