-
ADP vs. NFP - Which one do you believe?
If you ask most forex "educators" about the most important economic announcements each month the one that will inevitably be listed at the top is the NFP or "non farms" payroll report. This report shows the net gain or loss in jobs in the US. If the economy is expanding it will show a net gain. Likewise, if the number is negative jobs are being lost and the economy is contracting. The problem with the NFP report is largely statistical. The sample size prevents readings as accurate as traders may think. In fact, to get to a 90% confidence level the statistical "error" is increased to + or - 430K jobs. That is a very large range and renders estimates largely meaningless. However, this does not stop traders from worrying about the report and reacting to it. This reaction is more useful when it is applied to markets that are more sensitive to risk. For example, the report has more forecasting value for equities or the USD/JPY than other less volatile markets. In today's video we will start our discussion on the NFP report and its sister report from ADP. Both of these are due this week and are likely to be a big topic of discussion among traders and the press. To see the video, click here: [url]http://www.pfxglobal.com/forex-video-archives/adp-vs.-nfp-which-one-do-you-believe.html[/url]
- Comments
- Subscribe
- Comment #1
- Jul 30, 2008 7:39am Jul 30, 2008 7:39am
- pdolinaj
- | Joined Jul 2008 | Status: Member | 0 Comments
- Comment #2
- Jul 30, 2008 8:03am Jul 30, 2008 8:03am
- mohamadreza
- | Joined Sep 2007 | Status: Mohamad Reza Nourara | 1 Comment
- Comment #3
- Jul 30, 2008 12:06pm Jul 30, 2008 12:06pm
- WatchDAction
- | Joined Jul 2008 | Status: Junior Member | 0 Comments
- Comment #4
- Jul 31, 2008 2:39am Jul 31, 2008 2:39am
- tundeadepo
- | Joined Jan 2008 | Status: Junior Member | 0 Comments
- Comment #5
- Aug 1, 2008 7:59am Aug 1, 2008 7:59am
- gandalf
- | Joined Dec 2007 | Status: Member | 0 Comments