One forex news trading system is called the Nonfarm Payroll News Forex Trading Strategy.

With this Nonfarm Payroll News Trading Strategy, you do not care which direction the forex market moves when the data or the forex news comes out.

You care about placing your pending orders, and whichever side the market breaks out on, you have a trade-in in that direction.

To do that, you have to put two opposite chart pending orders:

• a buy stop order to catch the price breakout to the upside
• and a sell-stop order to catch the chart breakout to the downside.

Another thing we like to mention is that the best situation where can apply this news trading strategy is when the market is trading in a tight range before the news is released.

It wouldn’t be ideal to trade using this system if you had so many price whipsaws and spikes before the news.

Strategy Trading Rules

1. About 30 minutes before the nonfarm payroll news is due, open a 5-minute chart.
2. Find the range: this is the chart highest high and lowest low in this mt4 5 min chart.
3. Then place two pending but opposite orders on both sides, a buy stop order at least 5-10 pips above the chart highest high and a sell stop order 5-10 pips below the lowest low in that range.
4. Then also place stop loss(SL) on either side for each of the pending orders: your stop loss for a buy stop order will be the level at where you place your sell stop pending order and vice versa.
5. One of the chart pending orders will be activated when the nonfarm payroll data is released. Then immediately cancel the other chart pending order that was not yet activated.

Where To Take Profit In This Strategy?

There are a few other options you can use to take a profit:

1. two times the range or three times: for example, if the range is like 40 pips, then set your take profit(TP) at 80 pips, or if three times the range, your take profit(TP) would be 120 pips (which would be essentially risk: reward(R:R) ratio of 1:3)
2. Another way is no take profit(TP) target at all but to use a trailing stop and ride the massive price move until you get hit stop loss, as shown in the chart above.

Disadvantages of The Nonfarm Payroll Forex News Trading Strategy

• Just before or right after the nonfarm payroll data is released, sometimes, the price can behave erratically, causing chart spikes and whipsaws, and this can cause you to suffer a big double loss (remember? you got two charts pending orders?) as you wouldn’t really have much time to delete the other pending order. This happens very fast!
• There is also a big tendency to get very very bad fills on your order as liquidity tends to dry up quickly, so you get filled at the worst possible price by your forex broker.
• Spread also tends to increase dramatically, which can impact where you place your stop loss.

Advantages of The Nonfarm Payroll Forex News Trading Strategy

• 100-250 pips profit potential in just a few minutes or a few seconds.
• With this trading strategy, you will always catch whichever direction the price moves during a news release compared to a forex news trading system where you wait to see what the news data is before you take a forex trade, and by the time you take a trade, the price moved 100 pips already in few seconds.

Forex News Trading Is Not For The Simple Faint-Hearted

It is very exciting to trade forex news like the nonfarm payroll.

Do you want to know why?

Well, it is this:

If your trade goes very well without any hiccups, you can be staring at 100-250 pips in profit within seconds.

Now, for one standard contract, that is$1000 to 2000 dollars in profit right there!

You’d be very lucky to accumulate that kind of profit on an ordinary trading day within 1 or 2 days!

But this happens in Nonfarm Payroll news time in a few seconds and even in just a few minutes.

But having said that, you should be very careful. You can lose a lot of funds trading the nonfarm.

The lure of quick profit is tempting but avoid it: never risk your entire account or a more significant percentage of your trading account for nonfarm payroll trading or any news trading.

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Read More: 1 Minute Forex News Trading Strategy