It doesn’t require a rocket science degree to see why almost all people who trade non farm payroll are likely to get wiped out. Being wiped out with heavy losses by trade on economic news events such as U.S. dollar. Trade non farm payroll (NFP), the FOMC statement, or any big Forex news event on the Forex news calendar.
One problem is that a lot of traders completely abandon the whole concept of having a Forex trading strategy. Most especially at the time of the news. They simply try to get in because they see the market starting to move. Later, they wonder why the market turned against them. Many people have the delusional paranoid belief that its the because of the “big money”and the banks making them lose by tricking them and deliberately setting traps in the market.
Once you see how the market actually works, you will be able to trade non farm payroll like the “big dogs” yourself. You will see that the majority of traders are completely blind and lacks in common sense when it comes to trading Forex or currency trading.
The Federal Reserve or “the Fed” does actually control the market to some degree. I recently read that they intend to continue to inject false prosperity into the U.S. market throughout the month of December leading up to the end of the year. Those Forex traders who have been around a while (or who have the ability to look at charts and see what happened in the past) know that the market sometimes makes its final long term turning point right at the end of the year around the end of December or beginning of January.
Forex brokers by the way have NO ABILITY to actually move the market other than very minor deviations from the actual price at the time of execution of trade entries or exits. They cannot cause the EUR vs.the JPY to be in a downtrend if the entire world can see that its in an uptrend. Likewise, they can’t stop the market from turning and continuing when the global economy drives it to make a turn. Price is also common knowledge and is available on everyone’s charts throughout the world so broker’s can’t make you lose if you know how to make good trading decisions.
The historical economic data is released and made available to everyone on Forex news calendars such as Forex Factory and Daily FX. When this happens, there is often an immediate reaction that is based on impulse and emotion and then a delayed reaction that is based on larger forces of supply and demand. This is usually consistent with the pattern that is being formed on the charts in terms of Elliott Wave, a technical analysis science that studies the natural cycles of financial markets.
The confusion is usually caused by two things:
- The traders are viewing the market from too short of a time frame and are unable to see the patterns that are being formed across all longer time frames;
- they simply do not know how to read the natural patterns that financial markets make and most especially very few people know how to identify the end of a trend or the end of a correction they way we do on a daily basis in our live trading sessions.
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