A question I get asked all the time is should I trade NFP (Non-Farm Payrolls)? There are two aspects to the question as far as I’m concerned, depending on whether you are trading manually or using automated systems (forex robots).
As far as trading manually is concerned, I no longer bother with the NFP myself. This is partly to do with the fact that it doesn’t suit my time available to trade – the wrong time zone – and partly because the extreme volatility that often accompanies NFP just makes it a fairly risky venture.
If the volatility results in a nice spike, that can definitely be traded. However, you would have to be careful and pick your entry around the peak or trough of the spike. Do a search elsewhere on this site for trading spikes if interested; I’ve written several articles on it over the years. I also cover it thoroughly in the Price Action Engine.
As to whether or not to turn your automated systems/forex robots off during extreme volatility such as NFP’s, I have a standard answer to the question. I NEVER turn my robots off. That’s simply because they were designed, back-tested and forward-tested without ever turning them off. So they should take into account coping with extreme volatility in the markets. And this seems to be borne out by the results I keep getting with the AuthenticFX Forex Robots.
I’ve posted another video below to show you the latest results of our five portfolios of robots under test, after last night’s NFP. You can see that they took account of the volatility extremely well.
Of course, it’s up to you. Some people just can’t stand the volatility around these events, and won’t trade them and can’t bear the thought of allowing a forex robot to trade for them at such times. That’s fine: you can turn your robots off and back on again if you feel better about that. But the bottom line is that they have been designed to trade whenever the market is open, and you won’t get the same results – very likely you will get poorer results – if you do take this approach. Just my opinion, and I’m happy to take your feedback on this.
Here’s the video of our latest robot results after NFP’s:
Take Care & Trade Well,