Introduction
This article contains a set of rules about one of the most profitable tested strategies when the Non Farm Payroll is released.The U.S. Non-Farm payroll (NFP) is one of the most notable macro-economic releases in the US. The NFP measures the change in the number of people employed during the previous month, not considering the farming industry, government employees, private household and non-profit organizations employees. Job creation is correlated with the consumer spending, which accounts for the majority of economic activity. The NFP influence is usually notably larger than that caused by any other economic print in the Foreign exchange market. The release of the NFP generally occurs on the first Friday of every month at 8:30 a.m. EST.An higher than expected reading should be considered as positive/bullish for the USD, and a lower than expected reading should be taken as negative/bearish. As a result, many speculators, scalpers, traders, fund investors try to anticipate the NFP print and consequently could become very relevant the variance of the pair. The variance measures how far a set of numbers is spread out. A small variance indicates that the data points (price levels) tend to be very close each other, while a high variance indicates that the data points are very spread out around the mean and from each other. The traders usually do not have common thought as to the direction which the market will take following the release, that is why the market is extremely volatile.The market prices can move hundreds of pips within minutes and trying to trade it blindly could be not so intelligent. This strategy take advantage of this relevant volatility that the NFP release can create.

The Strategy


The strategy is tested on a 15-minute bar charts (M15) with the NZD/USD (Kiwi) currency pair. To apply this trading plan you need to find a broker that support the hedging mode.
  1. Open the Kiwi M15 Bar Chart.
  2. Around 12 minutes before nonfarm payroll released, you put two trading pending order in your trading platform. After the NFP release is not easy to predict the market direction. So with this situation, all you have to do is put pending orders in two directions. A Buy stop and Sell stop with the respectives Take Profit and Stop Loss.
  3. After the release usually the market take a well defined direction and you can close the against trend trade.
  4. Take your profit or your loss.


How to put the pending orders The bar before the release is the pending order level price indicator. The bar with its High and Low values is visible after 8:15 a.m. EST.
  • Open a Buy Stop position 15 pips higher than the maximum level price of the bar (Pink line on the figure)
  • Put the Stop Loss at the High price level of the bar (Green line on the figure)
  • Place the Take Profit 20 pips higher than the Buy Stop (Orange line on the figure)
  • Open a Sell Stop position 15 pips lower than the minimum level price of the bar (Pink line on the figure)
  • Put the Stop Loss at the Low of the bar (Green line on the figure) -
  • Place the Take Profit 20 pips lower than the Buy Stop (Orange line on the figure)


The figure 1 shows how to place the orders.







Results




The test started on the 07-03-2014 NFP release at 8:30 a.m. EST.

The figure 2 shows the 07-03-2014 result



  • Date 07-03-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD



The figure 3 shows the 04-04-2014 result






  • Date 04-04-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD


The figure 4
shows the 02-05-2014 result








  • Date 02-05-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD



The figure 5 shows the 06-06-2014 result




  • Date 06-06-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD



The figure 6 shows the 03-07-2014 result







  • Date 03-07-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD


The figure 7
shows the 01-08-2014 result





  • Date 01-08-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD
The figure 8 shows the 05-09-2014 result






  • Date 05-09-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD



The figure 9 shows the 03-10-2014 result









  • Date 03-10-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD



The figure 10
shows the 7-11-2014 result



  • Date 7-11-2014
  • Pair NZD/USD
  • Size Trade 3 Lots
  • Profit 20 Pips
  • Losses 0 Pips
  • Profit 900 USD




Observations The kiwi NFP M15 strategy from 07-03-2014 to 7-11-2014 has been very profitable.
  • 900 USD * 10 = 9000 USD Profit
  • 0 USD * 10 = 0 USD Losses Naturally it is possible that the strategy fail, but the data shows how statistically this trading plan can be very remunerative. It could be interesting if other traders have tried similar strategy and results on NFP release.




Good Trading to the Dukascopy Community and thanks for your support.
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