Wednesday fed meeting strategy.... got ideas?

KCalhoun

KCalhoun

It'll be interesting to see what the market's reaction will be Wednesday afternoon when Powell speaks at 2:30. Do you have a strategy for trading the reaction? If the market sells off, I'll buy inverses like tza sqqq. If the market rallies I'll buy cannabis, oil and bitcoin stocks.

There is usually a three-step reaction to Fed announcements during the half hour post talk...the first is the knee-jerk reaction, the second is a minor pullback and the third is a major breakout or breakdown.
 
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Most likely the market is going to react very violently
and very chaotic.
So it might not be easy to profit from it.

Better to wait for a few more hours to trade.
ie trade the coming Asian and European sessions.
By then, the market will not be that violent
and the market will still move substantially.
 
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I predict Fed is relatively doveish, markets break down anyways a bit, but that will just be a buying opportunity. I just pulled this out of my arse but let's see...
 
maxinger said:
Most likely the market is going to react very violently
and very chaotic.
So it might not be easy to profit from it.

Better to wait for a few more hours to trade.
ie trade the coming Asian and European sessions.
By then, the market will not be that violent
and the market will still move substantially.
More...

My prediction? Watch out for bank stocks. Close positions in them until the dust settles.
 
One of my favorite strategies is to put buy stop orders slightly above current market for both bull and bear trades, right before 2pm. That way, I have both directions covered.

I pay close attention to VIX, UVXY and TRIN
 
Powell is going to continue to swear on his mother's grave that he's not going to increase the interest rate and will try to drop the interest rate to -ve if he can but at the same time still has to report how sh**ty the economy is and how slow the economic recovery is going to be and the market is going to seize on that and ignore his vow to keep the interest rate zero and push the bond yield higher and the stock market lower but eventually the stock market is going to break through and end up a little bit higher for the day.

That's pretty much is going to be tomorrow's playbook.
 
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JSOP said:
Powell is going to continue to swear on his mother's grave that he's not going to increase the interest rate and will try to drop the interest rate to -ve if he can but at the same time still has to report how sh**ty the economy is and how slow the economic recovery is going to be and the market is going to seize on that and ignore his vow to keep the interest rate zero and push the bond yield higher and the stock market lower but eventually the stock market is going to break through and end up a little bit higher for the day.

That's pretty much is going to be tomorrow's playbook.
More...

Watch out for that little dot-plot! Man, they start monkeying around with that thing again and VIX to 35 before you know it.
 
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