What is the Meaning of NFP?
The meaning of NFP is The nonfarm payroll (NFP) report. NFP is a report that is released by the US Bureau of Labor Statistics (BLS) on the first Friday of every month. It shows an increase or decrease in employment and unemployment rates for each month since January 2000.
The BLS also releases other reports, including EITC Exemptions and Non-Exemptions; Births, Marriages and Divorces; Disability Insurance Claims; Goods Producing Industries Employment/Unemployment (July); Goods-Producing Industry Employment Rate (July).
What does it represent?
It's an important indicator of the health of our economy, as it shows how many new jobs are being created and how they're affecting household incomes across various demographics. In other words: if you're looking for signs that your local economy is growing or improving, this is one way to find them.
The reason why NFP matters so much can be summed up in one word: demographics. The United States has been experiencing declining birth rates since at least 1965—the last year when births exceeded deaths (births exceeded deaths by 1%). This means fewer new workers entering into our workforce every year. Consequently, there won't be enough people working until 2020 according to Census Bureau data released earlier this month which means higher unemployment numbers across all age groups except those over 55 years old.
How can you capitalize on NFP.
NFP is a very powerful news report to trade. The following are some of the key features and benefits of NFP:
Currency pair to trade: GBP/USD, XAU/USD, EUR/USD, USD/CAD . There are many other pairs as well that can be traded based on your strategy. You can also use advanced strategies such as trailing stop loss or trailing profit taking with NFP pairs if you want to maximize profits from this market.
Stop Loss: It prevents losses when price falls below a certain level. It will automatically close out open trades in case they fall below the set stop loss level which prevents further losses if the market goes against us during downtrend move while we were doing long term trading.
NFP is a highly volatile market and you must be able to manage your risk. Before you start trading NFP, it's important to understand that this type of investment has very little liquidity, so there is no guarantee that your position will be liquidated at all or at least within a reasonable time frame.
Conclusion
NFP provides a lot of volatility in the market and it is quite risky to trade the report so it is important to use proper risk management. This report is used by traders to gauge the health of the US economy so as to capitalize on the strength or weakness of the dollar. This report is released every first Friday of the every month and can be found on Forex Factory.
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