Play Both Sides of the Fed Decision

Play Both Sides of the Fed Decision

Jun 28, 2007

In light of the Fed decision, I am posting links to some of our previous Strategy Sessions that work best when the market is about to absorb key information:
  • The Fed Watcher – uses the unusual number of prints trigger to pinpoint key activity and incorporates some advice dished by TheKirkReport and Toni Hansen; the link describes the Bull version of the strategy, here is the Bear version of The Fed Watcher

  • The News Watcher – similar to above but more emphasis on volume surges (this configuration can be used long or short)

  • How to Hunt with the Pack – “go with the flow”, here’s how to find it (both sides are modeled in the post)

  • “Buy to the sound of cannons, sell to the sound of trumpets.” If you think the market will overreact to the Fed or any other breaking news item (e.g., the Middle East anyone?), this list of strategies will help you spot the oversold/overbought opportunities

Several of the past strategies were modified in their original post to better model the intended behavior. These can certainly be improved upon even further. Use them as a starting point to your own ideas and interpret them according to your own trading plan.

See Who’s in Control: Bulls or Bears

Look at one of the strategies. Right click and select the option of duplicating the window. In the new window right click and select ‘Configure’ in the bottom corner you’ll see a button that says, ‘Flip’. Click this button to see the exact opposite of the strategy configured instantly. Put the two windows side-by-side and watch how the market plays out.