4/16/2014 BOC Rate Statement / Overnight Rate (1000 EDT)
Forecast: 1.00%
Actual: 1.00%
Previous Revision: n/a
TRAP TRADE (DULL REACTION – NO FILL)
Anchor Point @ 0.9092
—————-
Trap Trade:
)))1st peak @ 0.9077 – 1000:06 (1 min)
)))-15 ticks
)))Reversal to 0.9113 – 1000:13 (1 min)
)))36 ticks
)))Double Bottom @ 0.9077 – 1000:50 (1 min)
)))-36 ticks
—————-
2nd Peak @ 0.9063 – 1006 (6 min)
29 ticks
Reversal to 0.9086 – 1010 (10 min)
23 ticks
Trap Trade Bracket setup:
Long entry – about 0.9071 (just below the S1 Pivot and LOD)
Short entry – 0.9118 (just below the R2 Pivot )
Notes: The BOC left interest rates unchanged as expected with little surprising in the comments. This matched the forecast of leaving the rate unchanged, and caused an unsustainable short spike that was too small by about 5-10 ticks to trip our tier. The reversal was sizeable, but it would have also barely missed the tier, so cancel the order. This report is prone to have that happen on occasion as the range of the spikes is so broad and we have conservative settings. After the long reversal, if fell to reach a double bottom before the :01 bar expired, then continued to fall another 14 ticks to the S2 Mid Pivot. Then it reversed 23 ticks back to the 20 SMA and PP Pivot. After that it chopped sideways for about 1 hour.