Trading FOMC is rather tricky. I used to trade breakouts of prior swing points during FOMC before I was a price action trader but have since moved to the more accurate method of treating FOMC initial bars as a trading range and trading their fBO and BP.
For example, the actual FOMC announcement resulted in b58, which was a large outside bar. Such a bar is a trading range and its BO can usually be faded. b59 was a rather weak bar with a small body compared to its tail size but had a strong close. If this bar was near the high of b58 it would be ideal since it would not force a short mid-TR.
On the other hand a 2L fBO at b65 provided an fBO entry on the other side of b58, which resulted in a large rally.
Note that not all FOMC announcements result in large moves but when they do, its usually a good risk to reward ratio. I recommend fixed size stops especially for large bars to limit your losses.
Cad, you haven't placed a single trade this month, how can that be possible? There must have been at least 1 trade that had a high probability of being profitable.
ReplyDeleteOr are you simply not including you exits in this blog anymore?
thanks for your time,
Manuel
I have temporarily stopped disclosing part or all of my trades. Will resume soon.
DeletePart of this is because I'm experimenting with contracts other than ES, part of it is trying out new setups and tolerance limits of my existing setups. If I have any positive results, I will post them here.
Hi Cad, could be the b5 a BOf of the TR in the open ??
ReplyDeleteMartin, I had a similar question, Cad said a fBO of the TR cannot trigger an entry near the center of TR.
DeleteOK Manuel, thanks for you reply.
Delete