3/17/2016 Official Bank Rate / Asset Purchase Facility (0800 EDT)
Forecast: 0.50%
Actual: 0.50%
TRAP TRADE – OUTER TIER
Anchor Pt @ 1.4366
————
Trap Trade:
)))1st Peak @ 1.4359 – 0800:01 (1 min)
)))-7 ticks

)))Reversal to 1.4391 – 0800:36 (1 min)
)))32 ticks

)))Pullback to 1.4373 – 0800:48 (1 min)
)))-18 ticks
————
Reversal to 1.4406 – 0803 (3 min)
33 ticks

Pullback to 1.4378 – 0811 (11 min)
28 ticks

Reversal to 1.4429 – 0816 (16 min)
51 ticks

Trap Trade Bracket setup:
Long entries – 1.4357 (just above the 100 SMA) / 1.4348 (just below the 50 SMA)
Short entries – 1.4375 (No SMA / Pivot near) / 1.4386 (just above the HOD)

Expected Fill: Both tiers short – avg short 1.4380.5
Best Initial Exit: 1.4374 – 13 ticks
Recommended Profit Target placement: 1.4366 (just above the R2 Mid Pivot) – move higher

Notes: Both short tiers would have filled in 23 sec, then it hovered briefly at the HOD before reversing to allow about 10 ticks total to be captured. Then it stepped higher before reversing to the 100 SMA.

11/7/2013 Official Bank Rate / Asset Purchase Facility (0700 EST)
Forecast: 0.50%
Actual: 0.50%
TRAP TRADE
Started @ 1.6077 (last price)
————
Trap Trade:
1st Peak @ 1.6049 – 0700:16 (1 min)
-28 ticks

Reversal to 1.6070 – 0700:38 (1 min)
21 ticks

Pullback to 1.6058 – 0700:43 (1 min)
-12 ticks

Reversal to 1.6073 – 0701:44 (2 min)
15 ticks
————

Trap Trade Bracket setup:
Long entries – 1.6060 (in between the LOD and the S1 Pivot) / 1.6050 (just below the S2 Mid Pivot)
Short entries – 1.6093 (just above the R1 Mid Pivot) / 1.6103 (just above the R1 Pivot)

Notes: The Bank of England left rates unchanged as expected, and the Asset Purchase Facility also remained unchanged. This caused a short move of 28 ticks that stepped lower until 16 sec into the :01 bar until it hit the S2 Mid Pivot, followed by a reversal back to the S1 Mid Pivot at 38 sec. Then it pulled back 12 ticks to the S1 Pivot before reversing again to the S1 Pivot and nearly the 200 SMA on the :02 bar. The initial short burst would have filled both tiers of the long orders, for an average entry of 1.6055, with 1 tick excess/heat on the outer tier. Then it kept climbing to the S1 Mid Pivot and bounced 3 times. Moving the profit target down to 1.6071 would have been prudent for 32 total ticks. After the :02, it tightened up and trended lower.

1/9/2014 Official Bank Rate / Asset Purchase Facility (0700 EST)
Forecast: 0.50%
Actual: 0.50%
TRAP TRADE
Started @ 1.6446 (last price)
————
Trap Trade:
1st Peak @ 1.6463 – 0700:06 (1 min)
17 ticks

Reversal to 1.6451 – 0700:15 (1 min)
-12 ticks

2nd Peak @ 1.6464 – 0701:21 (2 min)
19 ticks
————
Reversal to 1.6443 – 0714 (14 min)
21 ticks

Trap Trade Bracket setup:
Long entries – 1.6430 (just below the PP Pivot/LOD) / 1.6418 (just below the S1 Mid Pivot)
Short entries – 1.6463 (no support barrier nearby) / 1.6474 (just above the R1 Pivot)

Notes: The Bank of England left rates unchanged as expected, and the Asset Purchase Facility also remained unchanged. This caused a long move of 17 ticks at the open of the :01 bar in 6 sec, followed by a brief reversal that found support at 1.6451, just below the R1 Mid Pivot at :11 sec. Then it achieved a minor 2nd peak of 1 more tick early in the :02 bar, before pursuing a slow developing reversal in the next 12 min. You may or may not have been filled on the inner short entry as it was right on the threshold. If you were filled, since the reversal often returns to the origin, but you have the SMAs bunched up, an ideal exit would be 1.6450 on the 200 SMA for about 13 ticks. It eventually went another 7 ticks lower, but that was not a certainty, and it labored to get there.

3/6/2014 Official Bank Rate / Asset Purchase Facility (0700 EST)
Forecast: 0.50%
Actual: 0.50%
TRAP TRADE
Started @ 1.6725 (last price)
————
Trap Trade:
0701 bar only moved 6 ticks away from the anchor point

1st Peak @ 1.6752 – 0701:20 (2 min)
27 ticks

Reversal to 1.6713 – 0703:44 (4 min)
-39 ticks
————
Extended Reversal to 1.6704 – 0716 (16 min)
48 ticks

Trap Trade Bracket setup:
Long entries – 1.6708 (matching the low of 0632) / 1.6699 (just below the LOD / S1 Mid Pivot)
Short entries – 1.6742 (in between the R1 and R2 Mid Pivots) / 1.6751 (just above the R2 Mid Pivot)

Notes: The Bank of England left rates unchanged as expected, and the Asset Purchase Facility also remained unchanged. This caused a delayed move that came about 75 sec late, but still would have worked. The lesson learned here is that we can safely wait for a delayed move. After a dull :01 bar, we saw a large long move of 27 ticks that peaked at 1:20, followed by a slow, tame, deliberate reversal of 39 ticks in the next 2.5 min to cross the SMAs. This would have filled both short entries with 1 tick excess/heat on the outer tier. A target of around 1.6719, on the OOD would have been prudent and safe for 53 total ticks. After a few min of struggling in the middle of the SMAs, it fell for another 9 ticks on an extended reversal to nearly reach the S1 Mid Pivot.

5/8/2014 Official Bank Rate / Asset Purchase Facility (0700 EDT)
Forecast: 0.50%
Actual: 0.50%
TRAP TRADE (DULL REACTION-NO FILL)
Started @ 1.6966 (last price)
————
Trap Trade:
)))1st Peak @ 1.6955 – 0659:56 (0 min)
)))-11 ticks

)))Reversal to 1.6968 – 0701:09 (2 min)
)))13 ticks
————
Pullback to 1.6954 – 0703:58 (4 min)
14 ticks

Trap Trade Bracket setup:
Long entries – 1.6948 (on the OOD) / 1.6938 (just below the LOD)
Short entries – 1.6984 (just below the R2 Pivot) / 1.6993 (No SMA / Pivot near)

Notes: The Bank of England left rates unchanged as expected, and the Asset Purchase Facility also remained unchanged. This caused a muted move of only 11 ticks that acted 4 sec early. Then the :01 bar reversed 13 ticks. This was all well inside of the inner tier, so cancel the order on the dull reaction. After the first 3 bars, it continued to oscillated between the S1 Mid and R1 Mid Pivots with the major SMAs and PP Pivot in the middle of the action. Then it fell on the ECB report at 0745.