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NFP system - 5 minutes a month

  • #1
  • First Post: Edited 4:20pm Jul 7, 2017 11:59am | Edited 4:20pm
Hi Guys,
I have been trading for almost 10 years. Basically trading my own EAs, and some manual trading.
I am going to share with you one of my systems. It only takes 5 minutes per month, and the rules are very simple:

- Pair: Eur/Usd
- On the day of NFP release (Friday) , wait 15minutes before the end of the day. If the current price is higher than the open price of the day then place a SELL ORDER. If the current price is lower then the open price of the day then place a BUY ORDER.
- If the open price and close price of Friday are very close, like 5 pisps away or something like that, then dont take the trade, is pretty obvious that the market hasnt made any decision of where to go. So in that case is better to stay out.
- Stop Loss is 50 pips.
- Close the trade next week at the end of the trading day on Tuesday (In my case it is 21:00GMT).

- Account size: US$ 1,000
- Lot size: 0.2 lot (Yes, you will be risking between 10% of the account per trade, but is only ONE trade per month. Its THE TRADE). You can trade more conservative or more aggresive up to 20% per trade , but I recomend 0.2 lot per every US$ 1,000. If you want you can start trading 0.02 in a US$ 100 account.
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  • #2
  • Jul 7, 2017 12:03pm Jul 7, 2017 12:03pm
Today was NFP release. Looks like the price is going to close below open price. So prepare to take a long position before the end of the day.
  • #3
  • Jul 7, 2017 12:31pm Jul 7, 2017 12:31pm
Quoting cocolizo67
Hi Guys, I have been trading for almost 10 years. Basically trading my own EAs, and some manual trading. I am going to share with you one of my systems. It only takes 5 minutes per month, and the rules are very simple: - Pair: Eur/Usd - On the day of NFP release (Friday) , wait 15minutes before the end of the day. If the current price is higher than the open price of the day then place a SELL ORDER. If the current price is lower then the open price of the day then place a BUY ORDER. - Stop Loss is 50 pips. - Close the trade next week at the end...
Hi Cocolizo. Can you please specify what is the time shown on your broker platform at 21 GMT?
  • #4
  • Jul 7, 2017 12:35pm Jul 7, 2017 12:35pm
Quoting shiva
{quote} Hi Cocolizo. Can you please specify what is the time shown on your broker platform at 21 GMT?
Hi
At 21:00 GMT is 0:00 in my plataform , so a new day starts.
  • #5
  • Jul 7, 2017 12:47pm Jul 7, 2017 12:47pm
Have you looked at this idea for other USD based pairs like USD/JPY?
Never underestimate the powers of the Force.
  • #6
  • Jul 7, 2017 12:52pm Jul 7, 2017 12:52pm
Quoting cocolizo67
Hi Guys, I have been trading for almost 10 years. Basically trading my own EAs, and some manual trading. I am going to share with you one of my systems. It only takes 5 minutes per month, and the rules are very simple: - Pair: Eur/Usd - On the day of NFP release (Friday) , wait 15minutes before the end of the day. If the current price is higher than the open price of the day then place a SELL ORDER. If the current price is lower then the open price of the day then place a BUY ORDER. - Stop Loss is 50 pips. - Close the trade next week at the end...
Thanks a lot for posting this system. I just verified it with the NFP dates for all of 2017 and it holds up. Have you tried this with other high-impact releases? Do you know any theoretical reasons why this occurs?
It takes money to make money.
  • #7
  • Jul 7, 2017 1:10pm Jul 7, 2017 1:10pm
Quoting cocolizo67
{quote} Hi At 21:00 GMT is 0:00 in my plataform , so a new day starts.
Thanks.
  • #8
  • Jul 7, 2017 1:27pm Jul 7, 2017 1:27pm
I opened my buy pisition from now. Because i am sleepy at the end of day. I hope this breaking the law don't cause being loose.
  • #9
  • Jul 7, 2017 1:34pm Jul 7, 2017 1:34pm
Quoting eltd
I opened my buy pisition from now. Because i am sleepy at the end of day. I hope this breaking the law don't cause being loose.
Don´t worry, its fine. Around this time of the day on friday price won´t move that much.
  • #10
  • Jul 7, 2017 1:35pm Jul 7, 2017 1:35pm
Quoting The Jedi
Have you looked at this idea for other USD based pairs like USD/JPY?
I only trade Eur/usd.
Feel free to test other pairs if you wish and post the results.
  • #11
  • Jul 7, 2017 1:41pm Jul 7, 2017 1:41pm
Quoting Harpy
{quote} Thanks a lot for posting this system. I just verified it with the NFP dates for all of 2017 and it holds up. Have you tried this with other high-impact releases? Do you know any theoretical reasons why this occurs?
Hi Harpy,
No I havent tried any other news realease. Since NFP is the most important news event, I only trade NFP. About the reasons behind this movement, it could be to the fact that NFP is a leading indicator (not a lagging) which in most of the cases influences and determines the trend for the rest of the month.
  • #12
  • Jul 7, 2017 2:38pm Jul 7, 2017 2:38pm
I have verified back 100% accurate for 2017 but only 41% for 2016.
  • #13
  • Edited 3:42pm Jul 7, 2017 3:27pm | Edited 3:42pm
Quoting RnL
I have verified back 100% accurate for 2017 but only 41% for 2016.

Yes. This is solved by letting it ride until Tuesday. That gives s much better R/R ratio (without hurting too much w/l ratio), enough to compensate for the losses.

So you can choose between closing at the end of Monday, or if you are more aggresive you can close it at the end of TUESDAY.

By the way, if the close price and open price on Friday are separated by only 5 pips or something like that, dont take the trade, it is obvious that the market hasnt made any decision of where to go (Example Dic. 02 of 2016)

Forgot to mention that rule. I am updating in first post.
  • #14
  • Jul 7, 2017 3:34pm Jul 7, 2017 3:34pm
Ok. I took the Buy trade before the close. Will close at the end of Tuesday (21:00 GMT)
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  • #15
  • Jul 7, 2017 4:13pm Jul 7, 2017 4:13pm
Here some backtest results from 2016 and 2017

Starting with a US$ 5,000 account you could have traded 1 lot on 2016 and 1.5 lots on 2017, and made around US$ 8,000.
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  • #16
  • Jul 8, 2017 3:35am Jul 8, 2017 3:35am
Quoting cocolizo67
Here some backtest results from 2016 and 2017 Starting with a US$ 5,000 account you could have traded 1 lot on 2016 and 1.5 lots on 2017, and made around US$ 8,000. {image}
Thanks for the backtest, Cocolizo!

I have a feeling that even $2000 initial funding would have been sufficient to trade 1 lot from January of 2016 to make about $8000 in 18 months... Which is 400% profit in 18 months... Not bad...

Nevertheless, we should not forget about the fact that the analyzed sample size - for reliable statistical evaluation - is rather small.
Although I am not a programmer I presume that it is possible to build an EA around the concept partly for longer period backtests and also for trading convenience.
  • #17
  • Edited 9:02am Jul 8, 2017 7:42am | Edited 9:02am
Quoting RoboSeer
{quote} Thanks for the backtest, Cocolizo! I have a feeling that even $2000 initial funding would have been sufficient to trade 1 lot from January of 2016 to make about $8000 in 18 months... Which is 400% profit in 18 months... Not bad... Nevertheless, we should not forget about the fact that the analyzed sample size - for reliable statistical evaluation - is rather small. Although I am not a programmer I presume that it is possible to build an EA around the concept partly for longer period backtests and also for trading convenience.
Hi Roboseer, thanks for the comments.

Lot size depends of your risk tolerance. But I wouldnt go beyond 25% per trade. So 1 lot per US$ 2,000 should be the maximum

About the EA, I dont think is worthy because even if we backtest 20 years we will still only have 240 trades. So I would advice against the EA and just trade it manually. Also because on some months the entry can be very tricky because of close price closing too close to the open price.

I believe the strenght of the system is that you only take 1 trade per month, but its a very accurate trade. The system relies on the most important news event of the month (NFP) which is also a leading indicator and not a lagging one. This is a very important thing, you can bet your house, your car and whatever you like that the week after NFP there will be big movement on the market. You can not make any money if market doesn't move. So, by trading a leading indicator we are putting the odds in our favour.
  • #18
  • Jul 8, 2017 3:00pm Jul 8, 2017 3:00pm
Quoting cocolizo67
Here some backtest results from 2016 and 2017 Starting with a US$ 5,000 account you could have traded 1 lot on 2016 and 1.5 lots on 2017, and made around US$ 8,000. {image}
Hi cocolizo67

This is backtested result from 2010 to 2017. The result quite bad from the beginning but turned good since mid of 2016.

  1. 5 consecutively lost in 2010 and 2011.
  2. Jan-13 maximum accumulated pips lost down to -246.
  3. 11 consecutive win since Aug-2016 until now and brought up accumulated pips to 709.


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It's scary me with this backtest...
  • #19
  • Jul 8, 2017 4:18pm Jul 8, 2017 4:18pm
Hi Cocolizo
Thx for sharing your idea,I am going to give it a try.

However, the R/R ratio is largely depending on the ability of your broker to honor your stop and


Slippage will play a big role in the end result
  • #20
  • Jul 8, 2017 4:34pm Jul 8, 2017 4:34pm
Without mentioning widening of spread if you trade with floating spreads.... It's very difficult to have a reliable backtest. I would like to test it live with my broker to see. What's yours?
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