In modern Forex markets, price movements increasingly occur before major economic releases such as Non-Farm Payrolls. Professional traders and algorithms position themselves based on “expectations of expectations,” meaning that by the time data is published, its informational value is often exhausted, reducing NFP’s predictive power for directional trading.

Why markets move before the news even exists

Retail traders are taught that news moves markets. Professionals know something less intuitive: markets move before the news, often without any new information at all.

Forex prices are forward-looking by construction. They reflect aggregated expectations, not facts. When a major release like NFP approaches, the market is not waiting for the number — it is constantly repricing the probability distribution of possible outcomes.

This process begins days in advance. Analysts publish forecasts. Banks adjust positioning. Options markets reprice implied volatility. By the time the release arrives, price already embeds a consensus narrative about what “should” happen.

The real trade is not NFP. The real trade is whether reality deviates enough from what is already priced.

The concept of “expectation of expectations”

Professional trading desks rarely ask, “What will the NFP number be?”
They ask, “What does the market expect other participants to expect?”

This second-order thinking dominates modern FX.

If consensus expects a strong print, risk is positioned accordingly. If positioning becomes crowded, even a good number can trigger selling. Conversely, a mediocre result can rally the dollar if expectations were even higher.

Price reacts not to data, but to surprise relative to consensus positioning, which is often invisible to retail traders focused on the headline figure.

Why Non-Farm Payrolls is losing its edge

NFP still matters — but its information edge is shrinking.
There are several structural reasons. First, the US labor market is now tracked through multiple high-frequency indicators: job openings, weekly claims, wage surveys, and private payroll estimates. By release day, the informational gap has narrowed dramatically.

Second, algorithmic systems pre-position aggressively. Volatility models, options skew, and flow analysis signal likely scenarios well in advance. When the data hits, price often reacts violently — but directionally briefly. The move is about liquidity adjustment, not macro discovery.

This is why NFP increasingly produces whipsaws instead of trends.

How professionals actually trade “news without news”

Professionals do not trade the number. They trade imbalance.
They observe how price behaves before the release. Does USD strengthen gradually into NFP, or fail to follow through? Does volatility rise while price stalls? These divergences reveal positioning stress.

If price cannot move in the expected direction before the data, it often reverses after it — regardless of the headline.

This is not intuition. It is flow logic. Markets move most when participants are forced to reposition, not when they are confirmed.

Why retail traders are structurally disadvantaged

Retail traders face a timing problem they cannot solve. By the time the data appears on the screen, the market has already reacted at the interbank level. Spreads widen, liquidity thins, and execution becomes defensive.
The result is a paradox: the moment that feels most “informative” is often the least tradable.

Retail traders experience volatility without context. Professionals experience context without urgency.

The role of algorithms in killing predictability

Algorithmic trading did not make markets irrational. It made them faster at absorbing information.

When thousands of systems react simultaneously to deviations from expectation, price overshoots quickly — and then mean-reverts once liquidity stabilizes. This compresses opportunity into milliseconds and leaves discretionary traders chasing noise.

As a result, news trading has shifted from directional bets to volatility and structure-based strategies.

Outlook: news trading in 2026–2027 

Assumption-based analysis:
Economic releases like NFP will continue to matter symbolically but lose further predictive power directionally. Markets will react more to positioning, options structure, and liquidity stress than to raw data.
The edge will belong to traders who understand how expectations are built, not those who react to numbers.

Forex no longer trades news. It trades the gap between belief and reality. Non-Farm Payrolls still moves markets — but mostly by exposing how wrong consensus positioning was. In a world of instant information, the only surprise left is expectation itself.

By Miles Harrington 
December 17, 2025

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