FOMC announcement day… The expectation coming into the morning session was that after the dust settled from the morning reports, the stock markets would go into ‘Fed wait mode’, meaning they would set a range and work it until the 2:15pm EST FOMC announcement. Today’s example trade opportunity is based on this expectations.
The ES opened and push up into the DTG 4.75 level where it bounced and headed back towards the Globex low. Unfortunately on our primary trading chart of the 6 point and figure (6PF), the top did not provide an order flow entry opportunity. Volatility was low and perhaps a 4PF chart was appropriate and did provide a short opportunity, but I saw the opportunity after the fact so waited until the next. The ES fell short of the Globex low created by a GDP news spike. On the final attempt at the Globex low, the buyers defended the low and a head fake / trapped traders with little prints bottoming opportunity unfolded.
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