How to trade data

by | October 6th, 2017, 07:27:53 | News

It is a very special day for me, mainly because The US Jobs report will raise its formidable cloak this afternoon.

It is special because I have lost more money trying to trade this dog than in anything else. Once I lost 2 months earnings in one hour. The added pain was exasperated because it was Friday and my civilian friends wanted to go out at 5pm. I was sat at my desk chasing, scalping and then miserably failing. Often a ruined weekend I had on NFP Fridays. I cried. I got no sympathy from the head of the desk, so i went home and cried some more.

Here are some suggestions so you don’t have to go through my pain all those years ago.

Try and be quick but not that quick. Unless you’re co-located in New Jersey with the blackest of boxes then forget trying to hit it straight off. You are up against que-jumping ex NASA coders working near to the nanosecond. Good luck with that.

Maybe wait for the second wave. If it’s out of line try and wait for the above to take profit whilst sucking in the unsuspecting traders late to the party. I often wait for the first retrace of 38% with a stop at 50% of the price move. Patience is key.

Fade it. Probably an easier option especially if its in range and near to a big daily level. However with EURUSD if it comes in >190k you do not want to stand in its way. Expect 2 big figs and some.

Know your data inside out. I personally have over 7 years data recorded with all the moves. I started out with a diary – hand written. It’s not like that now but you get the point. Things to record are expectation, high, low, actual, G5 moves and pre-market focus and sentiment. Today is significant because of low expectations with Irma and high soft data this week with ISM’s. The USD was broadly bid in Aisa giving a unique context for a great asymmetrical play. Also, Livesquawk has ranges with their excellent data sheets. Check them out !

Leaks, conspiracy stories and jumpy cat moves 5 seconds to release. Yes, it happens but remember the market is thin as a rake. It moves on nothing so why would you believe in what it tells you when no-one is trading ?

Sit on your hands – and be different once a month. This is what i am going to do today. Remember the market will always give you another chance. No more pain for me my friends. Believe me when I tell you. The market doesn’t care what happens and it is bigger than you can imagine. I’ve seen 3 yards go through a Swiss hedgey and it wasn’t a showstopper. It didn’t even make a dent on price. At month end up to 160 yards can get done.

Good luck with that x

 

 

 

 

 

Patrick Reid
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