If you can, you should trade NonFarm Payrolls.
Especially when you are a trader who is still learning. If you are long in this game and manage serious founds then yes, maybe you can skip NFP day. All other traders with less experience should trade it.
I’m tired of reading messages like “Be careful out there, it’s NFP”. “Close positions and be safe”. “Do not trade NFP”. And so on…
Let me explain.
You should trade NFP but with very small position or eventually on demo account (but a live account will be better).
Your goal on NFP day is not to get rich quick in one day.Yes, sometimes you will catch perfect trades like I did today:
eurusd nfp trade
You want to trade NFP to learn.
This is perfect. We have a date, time. We know in advance that there will be some strong reaction to the NFP numbers. Dollar currencies, gold, indices… You can find that they all react to these numbers.
So what can we learn here? Many things like:
– How fast direction of the move can change
– How hunting for stop losses and catching traders on the wrong side looks in practice 🙂
– How spread changes before and during NFP release
– How slippage affects your trades
– How the difference between Bid and Ask prices affects your stop loss and why it is not a good idea to set a tight stop in such conditions
– and many others
When you trade during a month, on normal days you have a low spread and everything is fine.
You can easily forget that conditions can change in a second.
Trump may twitt something important about tariffs. There might be some conflict which will affect oil prices… Finally, you can have a flash crash without any reason.
It is much easier to exit an open position and cut losses or entry new trend if you know how to trade in such market conditions.
That’s why trading during NFP is such great training. It’s like drifting a car in snow on an empty parking lot. You have some fun and you can practice driving when the car is sliding. That can be very helpful on a normal drive when you lost control of a car and you have to react fast.
It’s always easier to act and make fast decisions if you have some experience.
Again, let me be clear.
If you trade NFP, do it on demo or with very small risk on your live account. Treat it as a fun and learning experience. It will pay off in the future.