- in Uncategorized by schooloftrade
FOMC Day LIVE Today; were you prepared for this?
We knew from experience what to expect from FOMC Day today…
Our Strategy today was simple:
– Be aware that FOMC Day = early close of the morning
– Attempt to take some trades according to rules
– Give the market a chance to give us some feedback
– Make educated decision on how/when to trade
– For example:
o First three trades today were scratches and small losses
o That tells us, be careful, today’s market may not be very conducive for our trading success
o If that’s the case, sit on those hands, or wait for the price action to IMPROVE
If you don’t KNOW what the better price action looks like ask questions, or simply move to a simulator and look for the best patterns.
The Market gives us CLUES today:
– Decent Volume @ open
– Consistent with FOMC Day
o High Volume Early in the Moring
o Volume will taper off as the morning progresses, in prep for FOMC announcement @ 215pm EST today
o FOMC = Federal Open Market Committee, they decide the Fed’s Monetary Policy, ie, interest rates, spending, saving, changes being made
o “Fed Day” “FOMC Day”
o Known by traders as being a day of very inconsistent price action
Early volume
Slows @ 1030am EST
Be very careful trading towards lunchtime EST
Afternoon session, wait for 215pm EST announcement
Then wait for the price action to get ‘stable’ b/c it will MOVE very violently today
Try to stay with your rules, don’t get wrapped up in all the mess of price action
– 9:15am Gold shows signs of Black-Box trading, High-Freq Trading system, flat choppy price action, and then violent spikes to the up-side.
– As of 9:15am we took 2 trades, both 2-step reversals, both were very difficult price action, slow and choppy, early exits to avoid losses.
– 945am Dollar is moving < 15 on Pace of Tape
o Means VERY slow price action
o The rest of the markets will also assume to be slow
o Wait for the dollar to pick up speed of tape to begin looking for trades today
Our first three trades of the day were all very slow price action and choppy.
As always, we give the market an opportunity to make us some money, and if the market isn’t there, we have to wait.
Fortunately, we made a trade on Gold Futures that brought us out of the red, but not by much, pretty much a breakeven day in the market on FOMC Day Futures.
4 trades today, 1 winner, 1 loss. 2 Scratches
+6 ticks, $60usd
Only 4 contracts needed to achieve this today!
See you tomorrow @ 745am EST for the live trade room session!
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