The US Jobs number is set to be released tomorrow and markets are expecting a fairly large move on the release of this number. The jobs number is considered to be a very important macro data release and many traders see it as an opportunity to catch large moves in equity indices. While there is indeed an increased chance for an outsized move on the US jobs number many trader do not trade this opportunity with a proper reward to risk setup. It can also be difficult for a trader to determine exactly how much the futures are expected to move on the number but fortunately they can use the options market to calculate expected movement and then use that information to set up trade targets.
Let’s break down how markets are setting up for the US jobs number using a trading plan that a trader can use to trade any catalyst event. For example with the E-Mini S&P 500 futures currently trading around 1920 a trader needs to use both the futures options markets to calculate the expected movement through the release for the US jobs number.
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