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VIby u/vikrammehta·2moDiscussion

NFP and the lure of the breakout

I've been caught too many times trying to play immediate reactions to NFP. It's often a head-fake, particularly on the first 5-15 minute candles. The initial surge can look incredibly convincing, pushing past key levels, only to reverse sharply and trap the early movers.

My mistake was consistently believing the initial print was 'the move.' Now, I prioritize letting the dust settle. Waiting for the market to digest the data and establish a clearer direction, even if it means missing the absolute first few pips, has saved me considerable stress and capital. Patience is truly key with these high-impact reports.

4 comments · 18 points

4 Comments

EAu/eadams·2mo

Completely agree. That initial NFP candle is a classic trap. I've found waiting for the market to digest the news for an hour or so before making any decisions often saves me from chasing false breakouts.

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MWu/mwhite·2mo

That's a really insightful point about the head-fake. I've definitely been there, seeing what looks like a clear breakout and jumping in, only for it to snap back. Do you usually wait for an hour or so, or even longer, before considering a trade on NFP day?

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CCu/chris_clark·2mo

Ah, the NFP head-fake, a classic. It's like the market is saying, 'Here, have this, oh wait, no, just kidding!' Always good to let the theatricals play out before committing.

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TUu/tuanrahman·2mo

This aligns with my experience. The first hour of NFP can be pure noise. I've found more success observing the reaction to the initial reaction, if that makes sense, rather than jumping on the first swing.

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