Cash Rate / RBA Statement | JO Bracket Breakout

6A 09-15 (1 Min) 9.1.2015

Sep 062015

9/1/2015 RBA Rate Statement / Cash Rate (0030 EDT)
Forecast: 2.00% (no change)
Actual: 2.00% (no change)
TRAP TRADE – INNER TIER
Anchor point @ 0.7129
————
Trap Trade:
)))1st Peak @ 0.7150 – 0030:23 (1 min)
)))21 ticks

)))Reversal to 0.7140 – 0031:04 (2 min)
)))-10 ticks

)))Pullback to 0.7150 – 0031:16 (2 min)
)))10 ticks
————
Reversal to 0.7130 – 0033 (3 min)
20 ticks

Pullback to 0.7148 – 0033 (3 min)
18 ticks

Reversal to 0.7116 – 0123 (53 min)
32 ticks

Trap Trade Bracket setup:
Long entries – 0.7108 (in between the PP Pivot / OOD) / 0.7096 (just below the S1 Mid Pivot / OOD)
Short entries – 0.7149 (in between the R2 / R2 Mid Pivots) / 0.7162 (No SMA / Pivot near)

Notes: The RBA made no major change in this cycle and is waiting to see when the FED will act to raise rates for the USD. This caused a 21 tick long spike in 23 sec that started on the 100 SMA and rose to cross the R2 Mid Pivot and extend the HOD. Then it reversed 10 ticks in 41 sec before pulling back for a double top. This would have filled the inner short tier as long as it was placed at 0.7150 or lower. Then is would have allowed for an exit with 5-9 ticks on the first reversal, or up to 17 ticks on the second reversal. The second reversal fell 20 ticks from the double top to the 100 SMA before pulling back 18 ticks. Then it reversed 32 ticks in 50 min after crossing the R1 Mid Pivot / 200 SMA.

6A 12-15 (1 Min) 10.5.2015

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Jan 082016

6A 12-15 (1 Min) 10_5_2015 6A 12-15 (Second) 10_5_2015

10/5/2015 RBA Rate Statement / Cash Rate (2330 EDT)
Forecast: 2.00% (no change)
Actual: 2.00% (no change)
TRAP TRADE – INNER TIER
Anchor point @ 0.7057
————
Trap Trade:
)))1st Peak @ 0.7083 – 2330:24 (1 min)
)))26 ticks

)))Reversal to 0.7068 – 2331:00 (2 min)
)))-15 ticks
————
2nd Peak @ 0.7095 – 2340 (10 min)
38 ticks

Reversal to 0.7084 – 2347 (17 min)
11 ticks

Final Peak @ 0.7108 – 0045 (75 min)
51 ticks

Reversal to 0.7086 – 0209 (159 min)
22 ticks

Trap Trade Bracket setup:
Long entries – 0.7037 (in between the PP Pivot / OOD) / 0.7024 (just below the S2 Mid Pivot)
Short entries – 0.7079 (just below the R1 Pivot) / 0.7091 (just above the R2 Mid Pivot)

Expected Fill: 0.7079 – inner short tier
Best Initial Exit: 0.7069 – 10 ticks
Recommended Profit Target placement: 0.7037 (inner long tier) – move higher to the R1 Mid Pivot after observation.

Notes: Exit quickly after noticing the failure to reverse strongly and hovering above the R1 Mid Pivot.

6A 12-15 (1 Min) 11.2.2015

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Jan 082016

6A 12-15 (1 Min) 11_2_2015 6A 12-15 (Second) 11_2_2015

11/2/2015 RBA Rate Statement / Cash Rate (2230 EST)
Forecast: 2.00% (no change)
Actual: 2.00% (no change)
TRAP TRADE – OUTER TIER STOPPED
Anchor point @ 0.7157
————
Trap Trade:
)))1st Peak @ 0.7090 – 2229:50 (0 min)
)))-67 ticks

)))Reversal to 0.7198 – 2230:02 (1 min)
)))108 ticks

)))Pullback to 0.7124 – 2231:00 (2 min)
)))-74 ticks
————
Reversal to 0.7162 – 2234 (4 min)
38 ticks

Pullback to 0.7142 – 2241 (11 min)
20 ticks

Reversal to 0.7198 – 2313 (43 min)
56 ticks

Trap Trade Bracket setup:
Long entries – 0.7135 (just below the R2 Mid Pivot) / 0.7123 (just below the PP Pivot)
Short entries – 0.7179 (just above the R4 Pivot) / 0.7190 (No SMA / Pivot near)

Expected Fill: 0.7135 / 0.7123 – both long tiers
Best Initial Exit: 0.7103 – stopped – 52 tick loss
Recommended Profit Target placement: n/a

Notes: Abnormally large whipsaw with no breakout cause that moved 13 sec early. The settings were just about 15 ticks too tight to handle it. Still note the symmetry of the top of the whipsaw and look to short it at the hovering.

6A 12-15 (1 Min) 11.30.2015

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Jan 082016

6A 12-15 (1 Min) 11_30_2015

11/30/2015 RBA Rate Statement / Cash Rate (2230 EST)
Forecast: 2.00% (no change)
Actual: 2.00% (no change)
TRAP TRADE – DULL NO FILL
Anchor point @ 0.7254 – shift 4 ticks lower to 0.7250
————
Trap Trade:
)))1st Peak @ 0.7263 – 2230:04 (1 min)
)))13 ticks

)))Reversal to 0.7246 – 2230:17 (1 min)
)))-17 ticks

)))Pullback to 0.7272 – 2232:05 (3 min)
)))26 ticks
————
Reversal to 0.7255 – 2305 (35 min)
17 ticks

Trap Trade Bracket setup:
Long entries – 0.7228 (just above the PP Pivot) / 0.7217 (just below the S1 Mid Pivot)
Short entries – 0.7270 (No SMA / Pivot near) / 0.7280 (just above the HOD)

Expected Fill: n/a – cancel
Best Initial Exit: n/a
Recommended Profit Target placement: n/a

Notes: After last month saw a 108 tick span whipsaw, we got a yawner that did not come near the inner tiers until about 2 min after the release. Cancel…

6A 03-14 (1 Min) 2.3.2014

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Feb 232014

2/3/2014 RBA Rate Statement / Cash Rate (2230 EST)
Forecast: 2.50%
Actual: 2.50%
TRAP TRADE (STOPPED OUT)
Started @ 0.8736 (last price)
————
Trap Trade:
)))1st Peak @ 0.8760 – 2229:59 (0 min)
)))24 ticks

)))Reversal to 0.8748 – 2230:01 (1 min)
)))-12 ticks

)))Pullback to 0.8770 – 2230:03 (1 min)
)))22 ticks

)))Reversal to 0.8748 – 2230:28 (1 min)
)))-22 ticks
————
2nd Peak @ 0.8804 – 2233 (3 min)
68 ticks

Final Peak @ 0.8870 – 2335 (65 min)
134 ticks

Reversal to 0.8848 – 2344 (74 min)
22 ticks

Trap Trade Bracket setup:
Long entries – 0.8724 (below the OOD and on the 200 SMA) / 0.8714 (no SMA/Pivot within 5 ticks)
Short entries – 0.8747 (just above the HOD) / 0.8759 (just above the PP Pivot)

Notes: Australia’s central bank left rates unchanged as expected, however the RBA signaled that interest rate cuts are at an end while omitting mention of an “uncomfortably high” exchange rate that was in the previous 2 statements. This caused a very large and decisive bullish move that unfortunately was not a good setup for the Trap Trade. The initial burst long would have filled both tiers of the short orders, then seen another 11 ticks of heat. It backed off to yield only 5 ticks of profit from the average position 28 sec into the :31 bar. With this report it would be prudent to move the stop loss tighter with the strong bullish reaction and exit near break even before it continued higher. If not, you would have been stopped out for a 15 tick loss. The final peak achieved a total of 134 ticks in the next hour in a dramatic upward fan that crossed the R2 Pivot, then it reversed for 22 ticks in the next 9 min back to the R2 Pivot.

6A 12-13 (1 Min) 12.2.2013

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Dec 192013

12/2/2013 RBA Rate Statement / Cash Rate (2230 EST)
Forecast: 2.50%
Actual: 2.50%
TRAP TRADE (INDECISIVE)
Started @ 0.9079
————
Trap Trade:
)))1st Peak @ 0.9089 – 2230:00 (1 min)
)))10 ticks

)))Reversal to 0.9059 – 2230:33 (1 min)
)))-30 ticks

)))Pullback to 0.9086 – 2232:17 (3 min)
)))27 ticks
————
Reversal to 0.9066 – 2238 (8 min)
20 ticks

Notes: Australia’s central bank left rates unchanged as expected. This caused an indecisive reaction overall, with swings between the S1 Pivot on the short side and the S1 Mid Pivot / 200 SMA on the long side. Fortunately, indecision is ideal for the Trap Trade, but the move was relatively tame. A trap bracket of 15-25 ticks would use the area below the S1 Pivot at about 0.9061 as the long entry and the OOD at 0.9096 as the short entry. The volatility started early, but use the 20/13 SMAs at 0.9079 as an anchor point. The initial burst long for only 10 ticks was too small and brief to allow an entry, but the fall to 0.9059 would have given an ideal long entry allowing up to 20+ ticks to be captured with a target just above the 100 SMA on the :33 bar. After that it reversed back to 0.9066 5 min later to the S1 Pivot, before rallying up to the 200 SMA and S1 Mid Pivot to continue the oscillating trend. After that it continued to oscillate around the 50/100 SMAs, then fell an hour after the report.

6A 12-13 (1 Min) 11.4.2013

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Dec 012013

Caption for 11/4:
11/4/2013 RBA Rate Statement / Cash Rate (2230 EST)
Forecast: 2.50%
Actual: 2.50%
TRAP TRADE (SPIKE/REVERSE)
Started @ 0.9475
————
Trap Trade:
)))1st Peak @ 0.9455 – 2230:28 (1 min)
)))20 ticks

)))Reversal to 0.9466 – 2230:38 (1 min)
)))-11 ticks

)))Pullback to 0.9441 – 2232:14 (3 min)
)))25 ticks
————
Reversal to 0.9467 – 2245 (15 min)
26 ticks

Notes: Australia’s central bank left rates unchanged as expected. This caused a bearish reaction overall, resulting in decisive short spike and follow on short trend. Not the ideal setup for a Trap Trade, but it would still offer a few ticks if played correctly. A trap bracket of 15-25 ticks would use the S2 Pivot at 0.9457 as the long entry and the R2 Mid Pivot at 0.9496 as the short entry. The reaction started late, about 16 sec into the :31 bar, then the long entry would have filled after 7 sec. After it retreated about 10 ticks and hovered, look to exit with about 8 ticks before it falls again. After the :31 bar it continued to fall to 0.9441 for a total drop of 34 ticks in 3 min as it eclipsed the S3 Mid Pivot, then it reversed for 26 ticks in the next 12 min to nearly reach the 50 SMA and S1 Pivot. After that it drifted lower until the new day.

6A 12-13 (1 Min) 10.1.2013

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Oct 162013

Caption for 10/1:
10/1/2013 RBA Rate Statement / Cash Rate (0030 EDT)
Forecast: 2.50%
Actual: 2.50%
TRAP TRADE (UPWARD FAN)
Started @ 0.9292
Trap Trade:
1st Peak @ 0.9312 – 0030:31 (1 min)
20 ticks

Reversal to 0.9302 – 0030:52 (1 min)
-10 ticks

Pullback to 0.9321 – 0031:20 (2 min)
19 ticks

Final Peak @ 0.9359 – 0121 (51 min)
67 ticks

Reversal to 0.9345 – 0123 (53 min)
14 ticks

Notes: Australia’s central bank left rates unchanged as expected 2 months after an expected cut of 25 BP and 1 month after the election of a new conservative PM. This caused a bullish reaction overall, resulting in an upward fan over nearly an hour. Not the ideal setup for a Trap Trade, but it would still offer a few ticks if played correctly. A trap bracket of 15-25 ticks would use the R2 Mid Pivot at 0.9309 as the short entry and the S1 Mid Pivot at 0.9276 as the long entry. The reaction started late, about 13 sec into the :31 bar, then the short entry would have filled. After hovering near the fill point for several seconds, it would have fallen to give you a handful of ticks about 40-50 sec into the bar. Without a hasty drop and the volatile swings, look to exit there and move your stop loss to break even just in case. After the :31 bar, it developed into an upward fan, achieving 67 ticks in 51 min, eclipsing the R3 Pivot on its final push. It backed off quickly, giving back 14 ticks in 2 min. Then it traded sideways as volume dried up.

6A 09-13 (1 Min) 8.6.2013

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Sep 302013

8/6/2013 RBA Rate Statement / Cash Rate (0030 EDT)
Forecast: 2.50%
Actual: 2.50%
TRAP TRADE
Started @ 0.8902
Trap Trade:
1st Peak @ 0.8883 – 0029:59 (1 min)
19 ticks

Reversal to 0.8936 – 0030:11 (1 min)
-53 ticks

Pullback to 0.8907 – 0030:45 (1 min)
29 ticks

Extended Reversal to 0.8948 – 0033 (3 min)
65 ticks

Pullback to 0.8924 – 0038 (8 min)
24 ticks

Notes: Australia’s central bank cut rates by 25 BP as expected after one of the RBA governors had spilled the beans about a week earlier. Since this was expected, the market had sold off for several says, pricing in the move, making it still safe for a Trap Trade. Using an anchor point of about 0.8902 as the average price action from the last several min and the 200 SMA position, this caused an initial short move of 19 ticks, followed by a quick reversal of 53 ticks in the next 12 sec. Using a 20-25 tick buffer, the short move would have barely missed our long entry at the PP Pivot and LOD, but the long move would have filled a short order at about 0.8927 just above the R2 Pivot, then given opportunity to capture up to 20 ticks as it fell to 0.8907 on the :31 bar. Be careful holding on to the short order for too long as the reaction was priced in and the market rallied after the RBA acted as expected. In the aftermath of the first 2 minutes, it would be safe to buy the dips as it kept inching higher for the next 2 hrs and was reluctant to fall.

6A 09-13 (1 Min) 9.3.2013

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Sep 302013

9/3/2013 RBA Rate Statement / Cash Rate (0030 EDT)
Forecast: 2.50%
Actual: 2.50%
TRAP TRADE
Started @ 0.8976
Trap Trade:
1st Peak @ 0.8989 – 0030:01 (1 min)
13 ticks

Reversal to 0.8973 – 0030:36 (1 min)
-16 ticks

Pullback to 0.8993 – 0031:06 (2 min)
20 ticks

Final Peak @ 0.9041 – 0114 (44 min)
65 ticks

Reversal to 0.9023 – 0156 (86 min)
18 ticks

Notes: Australia’s central bank left rates unchanged as expected 1 month after an expected cut of 25 BP, citing global growth running below average, but inflation well contained, and reasonable prospects of greater growth next year. This testimony was embraced by the market to cause a stable rally. The subtle moves initially would not have been large enough to trigger a trap trade bracket of 20 ticks as the market did not exceed 20 ticks from the appx anchor point of 0.8976 until the :33 bar. With the relatively tame volatility in the initial minute, cancel the trade and do not wait for it to fill. Also, when it does not go short in equal magnitude to the long move, the bias is bullish and not good for the Trap scenario. It turned into a FAN that resulted in 65 ticks attained in 44 min as it crossed the R3 Pivot, then the market sustained the rally and only reversed for 18 ticks in the next 40 min back to the 100 SMA.

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