Afternoon,

I hope everyone was out of the market before the Fed announcement. The market went up and down 8 points two times before finally deciding to head down for good. Notice on the following chart that the price stopped right at Woodies pivot twice then broke down and spent the rest of the afternoon bouncing in and out of S1. Here is the chart.

Fed Announcement Price Action

Click on chart to enlarge.

The first two trades of the day were both trend line breaks above the 56 EMA followed by a trader’s trick set-up. Here is the chart for trades 1 and 2.

Trades 1 and 2

Click on chart to enlarge.

As is my usual practice, I stop trading at 12 pm CST on Fed decision day and wait to see if there would be any set-ups after the news. There was a trend line break and a possible set-up right at S1, but I decided not to take it because of its proximity to the support area mentioned above. Entry would have been at 14:09 pm CST with an entry price of 715.20. The trade would have made the objective. Here is the chart.

Potential Trader’s Trick Set-up

Click on chart to enlarge.

So for today, there were 2 valid set-ups with 2 winning trades for a net profit of $400, ignoring slippage and commissions.

I have been getting a number of e-mails regarding the fact that I have added a number of indicators that I am using to filter trades (Woodies Pivots and the fib areas). Different market conditions require traders to make slight changes in the way they trade. During the month of January and February,  the market trended well in both up and down ranges. Since that time, the market ranges have condensed to a point that I am being more cautious about the entry area (making sure that I have room for the trade to go to my two point objective before reaching an area of support/resistance). If traders are  to make money, they need to know just where those areas are and but able to be nimble enough to get out with a small profit or not lose money. That is the reason why I have gone into great detail as to how I approach trading in these tighter trading ranges. I will continue to do my best show you exactly what I see in the markets so that you, the trader, can get the best possible odds in taking a trade.

I hope that these post and comments help you to catch a whopper!

Best regards,

Ron

This is not a solicitation to buy or sell. 
There is a risk in any investment