What is the NFP?

The non-farm payroll (NFP) figure is a key economic indicator for the United States economy. It represents the number of jobs added, excluding farm employees, government employees, private household employees and employees of nonprofit organizations.

NFP releases generally cause large movements in the forex market. The NFP data is normally released on the first Friday of every month at 8:30 AM ET. This article will explain the role NFPs play in economics and how to apply NFP release data to a forex trading strategy.

Global equities have been left licking their wounds this week as various external influences have made sentiment sour slightly after what has been an impressive run for stocks over the last few months. There is so much going on in the world at the moment that investors may be left a little confused as to what has been driving market sentiment in recent sessions.

One of the main sticking points is the ongoing spread of the Delta strain across the world, with a significant rise detected in places like the US, China, and Australia. It seems that even with high vaccination rates the virus is still highly infectious, which puts into question the feasibility of a return to normalcy anytime soon, and with that full economic recovery.

But stocks had been holding up remarkably well up until this week, when the Federal Reserve released its meeting minutes from its latest meeting in July, signaling that tapering of asset purchases was now being considered. There is no...

Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Stock valuation, also referred to as ‘equity valuation’, provides the framework for traders to identify when a stock is relatively cheap or expensive. The difference between a stock’s market value and its intrinsic value presents traders with an opportunity to benefit from this disparity.

The US Dollar’s aggressive push last week ended on an uncertain footing against the Canadian Dollar last week. While USD/CAD touched new 2021 highs at one point, prices came quickly back down on Friday. That left behind a bearish ‘Shooting Star’ candlestick pattern. While this is not necessarily a guarantee that a turn lower could be on the horizon, it does offer an ominous warning sign working in conjunction with negative RSI divergence. Confirmation is key, and a subsequent downside close risks opening the door to losses.

Chart Created in TradingView

The Euro remains tilted to the downside against the US Dollar, with EUR/USD consolidating lower within the boundaries of a bullish Falling Wedge chart pattern. While the latter can have upside implications, that may not become realized until a breakout above the formation is achieved. Until then, the US Dollar may continue outperforming. Prices are quickly approaching the critical 1.1603 – 1.1630 support zone....

GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall healthand potential growth of a country.Consequently, greater volatility in the forex market is closely observed during the GDP release.

The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Find out about the history of the Fed, its influence on USD and how to trade Fed monetary policy decisions.

Technical analysis of charts aims to identify patterns and market trends by utilising differing forms of technical chart types and other chart functions. Interpreting charts can be intimidating for novice traders, so understanding basic technical analysis is essential. This article reveals popular types of technical analysis charts used in forex trading, outlining the foundations and uses of these chart types.

The ISM manufacturing index plays an important role in forex trading, with ISM data influencing currency prices globally. As a result, the ISM manufacturing, construction and services indicators can provide unique opportunities for forex traders, which makes understanding this data (and how to prepare for its monthly release) essential.

Talking points:

Chart Prepared by Michael Boutros, Technical Strategist; AUD/USD on Tradingview

Notes:In my last Australian Dollar Weekly Price Outlook we noted that AUD/USD, “held confluent uptrend support for a second week- the focus remains on possible inflection down here with the short-bias vulnerable while above 7328 heading into the August open.” We warned that, “a break below this critical support zone would risk another bout of accelerated Aussie losses with such a scenario exposing subsequent objectives at the 1.618% Fibonacci extension of the yearly decline at 7122 and the 2020 & 2019 yearly opens / 38.2% retracement at 7016/52.”Monthly open support at 7328 held for nearly five-weeks before breaking on Tuesday with Aussie plummeting through pitchfork support to fresh yearly lows.

The decline is now testing the first major support target at 7122 with a key technical pivot zone just lower at 7016/52- risk for downside exhaustion into these levels. Initial weekly...

Trading bias is a predisposition or perspective of the financial markets whereby traders believe there is a higher probability of a certain outcome as opposed to any other alternate possibilities.

These trading biases are determined by technical and/or fundamental factors that support a specific outlook that explains market behaviour. This often relates to market trends being either bullish/bearish which signals appropriate trading strategy and style.

It’s not uncommon for forex traders to approach trading with the aim of collecting ‘x’ many pips a day from the market. Some may even consider adopting a strategy that only makes X amount of pips per day. However, there are complications that arise from this approach and setting such unrealistic goals.

This article will answer the question: “how many pips per day?” and explore the best approach to using pips – considering market fluctuations which affect daily pip movements and how to capitalise on this with a solid trading strategy.

The historical inverse relationships between gold and both the greenback and U.S. Treasury yields respectively are weighing in on the precious metal. The Dollar Index (DXY) has held its high level of negative correlation to gold while bond yields have been displaying a change of heart since late April 2021 (note correlation does not mean causation!).

The chart below illustrates this phenomenon as seen by the green and white synchronicity towards the right hand side of the chart. It seems as if the dollar is the main driver for gold prices between the two. The current low interest rate environment also accommodates higher gold prices but unfortunately for gold bulls, the prices do not reflect the underlying fundamentals at this moment.

Source: Refinitiv Datastream

Fundamentally, we may see a rally in gold with the delta variant plaguing much of the developing world as well as many key financial and logistical hubs such as the recent China port shutdown as...

Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price (the quote), it is essential to develop a sound understanding of how to read currency pairs.

A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. This is also known as “rollover” and forms an integral part of a carry trade strategy. Traders gravitate towards this strategy in the hope of collecting daily interest payments over and above any currency appreciation from the actual trade.

This article explains FX carry trades with the use of examples and presents a top carry trade strategy to use in your trading.

Market Health is a new tool for traders and analysts which gives a snapshot of global market performance, currency strength and real-time exchange opening and closing times.

Using data from Quandl, Market Health allows users to take a macro look at global markets and indices including the Dow Jones, S&P 500, FTSE 100 and DAX 30 to help formulate and deliver on trading strategies.

Split between 3 main viewpoints, users can easily switch between world overview, stock exchange open times and index performance.

The global view combines exchange opening times and currency performance, presented on a world map. The map, shown as a heatmap shows currency strength against a base currency of your choice.

Stock exchange opening times showcases 8 global stock exchange markets and details exactly when they’re open and closed, how long they’re open for and whether or not they’re currently closed for public holidays. All of this information is presented in an...

Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Traders of all levels should have a solid grasp of what forex leverage is and how to use it responsibly. This article explains forex leverage in depth, including how it differs to leverage in stocks, and the importance of risk management.

Aftera short-term period of sideways price action, Bitcoin is edging back to its recent multi-month high print at just over $48,100 and may soon be back to levels last seen in early-to-mid May of this year. While this resistance may hold at the first attempt, the overall positive mood in the market is likely to see repeated attempts if the initial effort fails.

Prices via CoinMarketCap.

The daily BTC/USD price is now just above the 50% Fibonacci retracement level that has proved difficult to break above conclusively. The spot price is back the important 200-day simple moving average while the CCI indicator is not in overbought territory as yet. The weekend trading session can be volatile due to lower volumes, so careful risk management is needed before entering any trade.

Ethereum broke out of its recent bullish trend channel this week, but its sell-off was stemmed by the 20-day sma mid-week. If this remains moving average remains supportive and Ethereum...

Everyone comes to the forex market for a reason, ranging between solely for entertainment to becoming a professional trader. I started out aspiring to be a full-time, self-sufficient forex trader. I had been taught the 'perfect' strategy. I spent months testing it and backtests showed how I could make $25,000-$35,000 a year off of a $10,000 account. My plan was to trade forex for a living and let my account compound until I was so well off, I wouldn't have to work again in my life. I was dedicated and I committed myself to the plan 100%.

Sparing you the details, my plan failed. It turns out that trading 300k lots on a $10,000 account is not very forgiving. I lost 20% of my account in three weeks. I didn't know what hit me. Something was wrong. Luckily, I stopped trading at that point and was fortunate enough to land a job with a forex broker. I spent the next couple of years working with traders around the world and continued to educate myself about the forex market. It...

Risk management is at the core of any good trading plan, without having a sound set of principles to follow a trader is doomed to fail. We outline rules and factors to consider when customizing a risk management game-plan right for you.

We understand the difficulties of trading, which is why we’ve put together a variety of guides designed to help traders of all experience levels.

Risk management is one of the most important aspects to successful trading, but far too often it’s overlooked. Job #1 for a trader is to always keep yourself in the game. A sound strategy and the discipline to follow it will go long way towards ensuring you stick around.

If you are in the learning stage, your objective is to keep losses very small until you figure out what you are doing from an analytical and strategy standpoint. Adhering to sound risk parameters early-on will go a long way towards building a foundation for later on.

For the more...