In this article we will explain why the NFP is the most important Data of the Economy in the US, the results of the Non-Agricultural Payroll move the market imporantly, operating in the schedule of publication of this news is complicated, since the volatility is very high
NFP data also influences commodities such as gold and oil, currencies, stocks, treasury bonds and interest rates.
This data generates great attention in the markets and influences market trends.
How do the data in the NFP report influence the Dollar?
If the data in the report is positive (more people working) it is good for the USD, and bad figures (worse than expected) would have a negative impact on the USD. Why? We will use an analogy of the stock market to answer this question. For example, when a company publishes good results in its financial report, the value of the shares of this company will rise. So good data in the NFP will raise the value of the USD against other currencies such as the Euro, the Pound or the Yen.
Before the publication of non-agricultural payrolls
The hours before the publication of this data are very volatile, it is difficult to predict in which direction the market is going to move
After the publication of Non-Farm Payrolls
Volatility begins at the time the data is published, and typically lasts several hours.
If we want to operate based on the NFP data, we will also have to take into account the expected and past data. We will have to be alert on live platforms where to receive the news as quickly as possible. If the results are positive, there is usually a double increase, the first at the time of publication of the positive data, then there is usually a decrease and then another impulse. Similarly if the data is negative.
There are different ways to operate the fundamental news, if you do not have experience I recommend you not to operate hours before or after the publication of the data.
If on the contrary you decide to operate this news, remember to put an SL to cover the operation and operate with a risk that you can afford.