A single glance at the end of the clouds… Employment Statistics/FOMC

What would someone who picks up this book be hoping for? Victory in FX, becoming a billionaire trader, or passive income that lets you live a life of leisure without working?

Unfortunately, I am still on that path. After more than ten years, I have finally conquered a peak of one mountain. Yes, victory in FX. I am convinced. If I continue forward like this, what I desire will be within reach, and I have gained a firm confidence that I will obtain it by proceeding as I am.

Why can I speak so confidently in this uncertain world of markets? It does not come from ten years of experience. It comes from valuable information derived from analyzing a decade’s worth of accumulated data.

Was there meaning to these ten years, or perhaps not much meaning at all? Yet time, fate, and the chances we meet can sometimes smile cruelly and sometimes kindly.

I first learned of the existence of FX more than ten years ago, back when I was a college student. Or to be precise, that is a little different. I must apologize for telling one small lie. I was not yet in university at that time.

I had aimed to enter a university in Kyoto, but failed the entrance exam and lived as a Ronin (a student studying to retake exams). A friend who studied with me in high school for the exams attended a local university in the Tohoku region.

Because we were in the status of Ronin, we could not meet often, but we did have occasional meals together. At that time, the new iPhone was sweeping the world. The world—no, our little circle of the world then—was captivated by Steve Jobs’ iPhone, and it wasn’t an exaggeration to say that the word “apps” was born around this time as smartphones became popular.

Innovation and venture activities were a big wave in the world of young people from our small perspective. My friend M was one of the young people who were drawn to Steve Jobs.

He tried to start a student business, gathering male and female friends from high school and university to launch a venture.

For us who were still young, that might have been naive. Yet the world we could see seemed as clear, beautiful, and sometimes bitter-sweet as the worlds in Haruki Murakami’s novels, shining with hope.

To briefly summarize the plan that friend M laid out: raise funds through FX, and use that capital to start a large business. He was full of ideas, so of course there were other plans as well, but in my somewhat rusting yet still being polished memories, his venture-innovation plan involved fundraising through FX and developing iPhone apps. If the substance is there, it might not be a ridiculous story at all. There was substance to friend M’s plan.

Employment statistics.

The day of the U.S. employment statistics moves the market a lot. A method that reliably earns near profits by repeatedly trading forex as it moves in response to those big swings was popular. During this period when the iPhone 4 was trending, employment statistics moved as if the iPhone’s unstoppable momentum—though maybe too grand a term for our era—were especially large. Of course, friend M wasn’t a fool, so he had a proper strategy. Are there advantages to big-moving indicators like employment statistics and FOMC? Let’s move the hands of the clock forward to now and test it.

Data verification

No.1

Employment statistics, FOMC, economic indicators, fundamentals

Advantages 76%

From here, I plan to test ten major methods. An advantage of 75% means the method is relatively advantageous; the closer to 100, the more advantageous; below 50 means not advantageous.

The methods I introduce are mainly considered from a technical perspective. However, you cannot discuss FX without fundamentals such as economic indicators. In particular, important indicators are ones FX traders should be conscious of.

Compared to the time when the iPhone 4 swept the world, the moves during employment statistics and FOMC may be smaller now. Nevertheless, even in currencies like USD/JPY, big events can move 50 to 100 pips (50 sen to 1 yen).

When USD/JPY moves by 1 yen, if you hold a one-lot position (100,000 units), you can expect about 100,000 yen in profit or loss.

What employment statistics and FOMC and other economic indicators are like, and what else exists, I’d like you to look up with the Apple-like wonder of civilization—Google, etc.—for yourself.

Let’s return to the main topic. But it is a double-edged sword. When the market moves greatly, there is also a substantial risk of large losses.

To avoid miscalculation and losses, it is necessary to keep large events on the schedule in mind to some extent.

A few days before I am writing this sentence, there was an important FOMC economic indicator release. I was fortunate to gain nearly 50 pips in profit on a USD/JPY trade. I was long on USD/JPY.

But I did not predict that USD/JPY would rise. Honestly, I did not know which way it would move. I just happened to be long from previous trades and continued holding it.

Some of you may worry that this becomes a so-called gamble trade or a prayer trade.

To be clear, FX is not a game of predicting up or down. Even if you decide the direction with a coin toss, a skilled trader can still profit. FX is a game where nine out of ten players lose. If you think FX is a game of predicting up or down, you are likely one of those nine.

If you find yourself thinking of such things, please turn to the next page and take a look.