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5. Futures Economic Reports for Wednesday July 27, 2016
Hello Traders,
The FOMC interest rate decision is due at 2:15 ET in the US tomorrow ( Wednesday, July 27th ). Also more than a few economic numbers ahead of the announcement.
FOMC days have different characteristics than other trading days. If you have traded for a while, check your trading notes from past FOMC days that may help you prepare for tomorrow.
if you are a newcomer, take a more conservative approach and make sure you understand that the news can really move the market.
The following are suggestions on trading during FOMC days:
- Reduce trading size
- Be extra picky = no trade is better than a bad trade
- Choose entry points wisely. Look at longer time frame support and resistance for entry. Take the approach of entering at points where you normally would have placed protective stops. Example, trader x looking to go long the mini SP at 2165.00 with a stop at 2159.00, instead “stretch the price bands” due to volatility and place an entry order to buy at 2159.75 and place a stop a few points below in this hypothetical example.
- Expect the higher volatility during and right after the announcement
- Expect to see some “vacuum” ( low volume, big zigzags) right before the number.
- Consider using automated stops and limits attached to your entry order as the market can move very fast at times.
- Know what the market was expecting, learn what came out and observe market reaction for clues
- Be patient and be disciplined
Continue reading “FOMC Due Tomorrow 7.27.2016”
