4/4/2013 ECB Minimum Bid Rate (0745 EST)
Forecast: 0.75%
Actual: 0.75%
SPIKE/REVERSE
Started @ 1.2818
1st Peak @ 1.2889 – 0746 (1 min)
71 ticks
Reversal to 1.2811 – 0803 (18 min)
78 ticks
Notes: The ECB decided to leave the Minimum Bid Rate unchanged at 0.75% in line with most economists expectations in the face of a possible but unlikely rate cut to 0.50% and had little to say as the rates were released to move traders. It was trading sideways above or on the SMAs in a tight fist before the news, then the long spike carried it 71 ticks to the R2 Pivot and right back down . With JOBB, your order would have filled long at 1.2824 with no slippage, then you would have seen very frenetic oscillations between 1.2820 and 1.2889 for about 2 sec before it came back to the origin. If you were lucky and had a profit target built in or pressed the close button at the right time, you could have captured some nice profit. Otherwise you probably exited near breakeven. After the crazy :46 bar, it drifted lower to touch the 50 and 100 SMAs, then climbed about 25 ticks before the press conference took it about 90 ticks south as the ECB defended the asset buying program. The recent bailout of Cyprus with the confiscation of savings accounts likely caused the unsustainable :46 bar.