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The website www. Live Support. In this guide will introduce you with the most important Forex trading employment indicators, and teach you how to use them in order to foresee the direction of the currency market, in order to make more accurate forex signal trading. Forex trading employment indicators are used for fundamental analysis of the Forex trading market, and are long term currency predictors, unlike technical analysis indicators which are for short term use.

The employment indicators we will cover in this guide include two major employment indicators: the Employment Cost index and the Employment Report.

Trading the Non-Farm Payroll Report

This is an indicator that is published every quarter by the US Department of Labor. The employees' compensation growth, wages and benefits are measured by this index.

The ECI is a measure of over industries, in 50 states and metropolitan areas. As with all aspects of trading, whether we make money on it is not assured. Approaching the trade from a logical standpoint, based on how the market is reacting, can provide us with more consistent results than simply anticipating the directional movement the event will cause.

Forex Fundamentals! How Unemployment Rate Affects The Market!

Because the forex market is open 24 hours a day, all traders have the ability to trade the news event. The logic behind the strategy is to wait for the market to digest the information's significance.

Canadian employment data may drive loonie higher – Forex News Preview

After the initial swings have occurred, and after market participants have had a bit of time to reflect on what the number means, they will enter a trade in the direction of the dominating momentum. They wait for a signal indicating the market may have chosen a direction to take rates.

This avoids getting in too early and decreases the probability of being whipsawed out of the market before it has chosen a direction. The strategy can be traded off of five- or minute charts. For the rules and examples below, a minute chart will be used, although the same rules apply to a five-minute chart. Signals may appear in different timeframes, so stick with one or the other.

Looking at the chart above, the vertical line marks the a. EST p. As you can see from the chart, there are three bars, or 45 minutes, of back-and-forth action following the release. During this time, traders do not trade until they see an inside bar. The inside bar has a square around it on the chart. This bar's price range is fully contained by the previous bar.

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Traders will enter when a bar closes higher or lower than the inside bar. The next bar's close is circled, as that is their entry; it closed above the inside bar's high. Their stop is 30 pips below the entry price , which is marked by a solid black horizontal bar. Because their entry occurred at approximately at a.


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  • FOREX-Dollar shy of highs as investors await U.S. employment cues;

GMT , they will close out their position four hours later. By entering the trade at 1. However, it should be noted not every trade will be this profitable.

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While this strategy can be very profitable, it does have some pitfalls to be aware of. For one, the market may move in one direction aggressively and thus may be beginning to fade by the time we get an inside bar signal. In other words, if a strong move occurs prior to the inside bar, it is possible a move could exhaust itself before we get a signal. It is also important to note in high volatility times, even after waiting for a pattern setup, rates can reverse quickly. This is why it very important to have a stop in place. The logic behind this strategy of trading the NFP report is based on waiting for a small consolidation, the inside bar, after the initial volatility of the report has subsided and the market is choosing which direction it will go.

By controlling risk with a moderate stop, we are poised to make a potentially large profit from a huge move that almost always occurs each time the NFP is released. Jared Levy.


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