As one of the popular event for News Trading, there are a variety of trading strategies NFP (Non Farm Payroll) being run by the trader. Most people hide her strategy, but there are also some publish it, so that it can be a guide for the other traders who do not yet have a strategy trading NFP potent.
Among traders who publish trading strategy NFP is Cory Mitchell, a member of the technical analysts Association of Canada that has been trading since 2005 and manage site Vantage Point of Trading. How trading strategy NFP ala Cory Mitchell?? We will review here.
Setup A Trading Strategy For NFP
NFP trading strategy is set aside for the currency pair GBP/USD chart 15 minutes (M15). According to Mitchell, M15 chart allows volatility beginning to shrink, while still opening the opportunity for us to capture the movement of potentially great when market participants make a more rational decision about whether they will buy or sell based on the news of NFP that just came out. The rational trend that followed after that initial surge is the trend that seeks to be caught with a setup this NFP trading strategy.
Pair EUR/USD could also be used, but because of the GBP/USD typically have daily range greater than the EUR/USD, then the chance of more potential. Chart 15 minutes can also replaced the 5 minute chart, but it will be very prone to false signal.
The Rules Of NFP Trading Strategy
1. Don't do anything in 15 minutes after the announcement of the NFP. A large candle will appear on the chart between the hours of 8:30 am-8:45 AM EST, but you don't need to bother the cadle.
2. Wait until the appearance of the Inside Bar. Inside the Bar here is a 15-minute candle where the High and Low level entirely within the range of the previous candle.
3. high and low Levels are present in the Inside of the Bar will be the trigger (trigger) in the NFP trading strategy. If the price rises to the top level high on the inside bar, then order buy. If the price fell to below the low level on the inside bar, sell order.
4. Place a stop loss at 30 pips from the starting position, or below the last low level if you do order buy. However, the stop loss should not be more than 30 pips.
5. Exit the positions about 4 hours after entry or a maximum at 2:00 PM EDT. Once started, the trend usually lasts about 4 hours, so if your entry at 9:15 PM for example, then exit at 1:15 PM EST. However, at 2:00 PM EST, you should exit from this trading post position NFP, because other factors will start to affect price movement , while the NFP's own influence had already been wiped out.
6. do not make more than 2 positions of the trading post of NFP. If you still got the stop loss after trading opened position 2 based on your trading strategy this NFP, means price movements too random (on choppy). This tactic to save event data release of Non Farm Payroll the next, or the publication of other high-impact data.
7. The last step, you can also apply a trailing stop or the like to prevent loss of profit if the sudden trend turned around after the trading opened position. However, it is not required. Trailing Stop is only a complement for NFP trading strategy. Along with the progress trend, slide the stop loss to the low level or high level.
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