Trading Non-Farm Employment Change is quite challenging and risky unless you are using binary options to limit risk. Even with the best setup, sometimes the markets will go against you. In these examples, using low risk combinations, even if the market were to go against the trades, more than likely one side would be profitable.
Trading Non-Farm Employment Change With Binary Options & Spreads
Both the GBPUSD and USDJPY had hidden divergence (if using the TradersHelpDesk Stochastics) at the Average True Range Stop indicating the direction the would go when the Non-Farm Employment Change numbers came out. All risk and profits below are based on trading one contract each and the exchange fees are not included in the calcuations.
A long binary option was placed on the GBPUSD with a risk of $26.75 and a short spread was placed for protection for a risk of $18. A profit target on the binary option was set at $85 and was filled resulting in a profit of $58.50. The short spread lost $18.
A short binary option was placed on the USDJPY for a risk of $26.50 and a long spread was bought for protection for a risk of $27. A profit target at $15 was set and was filled resulting in a profit of $58.50 on the short binary. The long spread lost $27.
Additionally a DAX long binary option was entered for $11.25 in risk and a short binary was entered with a risk of $15.75. A profit target on the long was set at $85 and at $15 for the short. The short target was filled for a profit of $71.25. The long lost $15.75.
While the premiums for trading Non-Farm Employment Change were high on the Gold daily and 2 hour binaries, I opted to enter the weekly for less risk. A long was placed for a risk of $6.75. A short was placed for $27 in risk. These two binaries do not expire until 1:30. A profit target is set at $85 on the long and $15 on the short.
Trading Non-Farm Employment Change With Binary Options – Results
Although the Gold binary options are still pending, the results so far are (calculated per contract excluding exchange fees):
- USDJPY – $31.50 ($58.50 profit minus $27 loss)
- GBPUSD – $40.25 (58.25 profit minus $18 loss)
- DAX – $60 ($71.25 profit minus $11.25 loss)
- Gold – $27 loss on 1259.5 strike, 1279.5 pending but the risk is only $6.75 total
Allocating for the $27 loss, the current Profit for the morning is $104.75. While this could go down $6.75 if the profit target is not filled on Gold. If the profit target is filled on Gold, then the profit for the day would be $183.
UPDATE: The profit target on Gold was filled so the Profit for today was $183, after losses (calculated based on trading one contract each, excluding the $2 roundtrip exchange fee).
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