Stavro D'Amore
Former FPA Special Consultant
- Messages
- 547
US Federal Funds Rate
Forecast 0.25%
Previous 0.25%
Pair to trade: EUR/USD
The triggers we need: BUY EUR/USD: Looking for Emergency rate cut
SELL: Any increase (very unlikely)
Economical Impact: High
Typical Result: Forecast is good for the currency at the moment.
Occurrence: This is released monthly, about 40 days after the month ends
About our Triggers:
It is very unlikely the Fed will hike rates to 0.25% or decrease rates; however this is news trading and I will be there just in case we get a surprise or some sort of deviation. We will BUY EUR/USD if we see any form of increase and we will short SELL if we see an Emergency Rate cut which is more likely than an increase, due to current market conditions. There is 90% chance that this will be a NO TRADE.
If our tradable releases are reached, there is a good expectation that the market will move 60-70 pips within 2 spikes in the first 15 minutes.
Why do we care? And what is it?
The rate decision is often priced in the market so it tends to be overshadowed by the FOMC Statement which is focused on the future. Short term interest rates are the paramount factor in currency valuation - traders look at most other indicators merely to predict how rates will change in the future.
Method to trade this: Stavro D’Amore Trading Method
I will look for a 30% retracement in the original spike before entering a trade.
I will sell half my position as soon as I hit the original high point of the first initial spike and place a SL at entry price. My TP level would be just before a resistance level, or if the chart decides to form a level looking at a 15 minute time frame, after news release.
Historical Chart and Data for US Federal Funds Rate
All the best
Stavro D’Amore
Forecast 0.25%
Previous 0.25%
Pair to trade: EUR/USD
The triggers we need: BUY EUR/USD: Looking for Emergency rate cut
SELL: Any increase (very unlikely)
Economical Impact: High
Typical Result: Forecast is good for the currency at the moment.
Occurrence: This is released monthly, about 40 days after the month ends
About our Triggers:
It is very unlikely the Fed will hike rates to 0.25% or decrease rates; however this is news trading and I will be there just in case we get a surprise or some sort of deviation. We will BUY EUR/USD if we see any form of increase and we will short SELL if we see an Emergency Rate cut which is more likely than an increase, due to current market conditions. There is 90% chance that this will be a NO TRADE.
If our tradable releases are reached, there is a good expectation that the market will move 60-70 pips within 2 spikes in the first 15 minutes.
Why do we care? And what is it?
The rate decision is often priced in the market so it tends to be overshadowed by the FOMC Statement which is focused on the future. Short term interest rates are the paramount factor in currency valuation - traders look at most other indicators merely to predict how rates will change in the future.
Method to trade this: Stavro D’Amore Trading Method
I will look for a 30% retracement in the original spike before entering a trade.
I will sell half my position as soon as I hit the original high point of the first initial spike and place a SL at entry price. My TP level would be just before a resistance level, or if the chart decides to form a level looking at a 15 minute time frame, after news release.
Historical Chart and Data for US Federal Funds Rate
All the best
Stavro D’Amore
Last edited by a moderator:
