3/19/2014 FOMC Statement / FED Funds Rate (1400 EDT)
Forecast: n/a
Actual: n/a
TRAP TRADE
Anchor Point @ 132’16
————
Trap Trade:
1st Peak @ 132’00 – 1400:29 (1 min)
-16 ticks

Reversal to 132’14 – 1402:54 (3 min)
14 ticks
————
2nd Peak @ 131’29 – 1418 (18 min)
19 ticks

Reversal to 132’07 – 1444 (44 min)
10 ticks

Trap Trade Bracket setup:
Long entries – 132’08 (just above the S3 Mid Pivot)
Short entries – 132’24 (just above the S1 Pivot)

Notes: The FED chose to continue tapering QE3 by $10B as expected down to $55B a month, saying they will continue to monitor the economy and labor sectors while also saying they do not want to be seen as reacting to every gyration in financial markets. The surprise from new Chmn Yellen was that they would look at raising rates in early 2015 when tapering was finished and no longer be bound by the 6% unemployment metric they had previously promised to use. This caused a larger than expected short move that would have been a great trap trade with larger tiers. Your inner long entry would have filled, then after a few sec been stopped as it pushed lower. In hindsight a 2-tier approach with the outer tier at 14 ticks would have been ideal. That would have filled and then with an average entry of 132’05, allowing about 8 ticks to be captured on the reversal on the :03 bar. After chopping for about 10 min, it fell for a 2nd peak of 3 more ticks, eclipsing the S3 Pivot. Then it reversed for 10 ticks in the next 26 min to the S3 Mid Pivot.

6/18/2014 FOMC Statement / FED Funds Rate (1400 EDT)
Forecast: n/a
Actual: n/a
TRAP TRADE
Anchor Point @ 135’17
————
Trap Trade:
)))1st Peak @ 135’05 – 1400:09 (1 min)
)))-12 ticks

)))Reversal to 135’24 – 1400:38 (1 min)
)))19 ticks

)))Pullback to 135’12 – 1401:45 (2 min)
)))-12 ticks

)))Reversal to 135’20 – 1402:13 (3 min)
)))8 ticks
————
Pullback to 135’06 – 1406 (6 min)
14 ticks

Reversal to 136’06 – 1433 (33 min)
32 ticks

Trap Trade Bracket setup:
Long entries – 135’09 (no SMA/Pivot near) / 135’02 (just below the S1 Mid Pivot / OOD)
Short entries – 135’24 (just above the R1 Mid Pivot) / 136’00 (No SMA / Pivot near)

Notes: The FED chose to continue tapering QE3 by $10B as expected down to $35B a month, saying nothing significant has happened to cause a deviation from the course of action while also stating that it could be a while before rate hikes commence. This caused a short move of 12 ticks to fall just 2 ticks short of the S1 Mid Pivot and quick retreat of 19 ticks to cross the R1 Mid Pivot as is typical. Your inner long entry would have filled, then allowed for an exit around 134’22 with 13 ticks as it hovered for aver 20 sec as the :01 bar was expiring. After that it continued to execute several large swings and eventually broke out long and trended slightly higher heading into the close.

9/17/2014 FOMC Statement / FED Funds Rate (1400 EDT)
Forecast: n/a
Actual: n/a
TRAP TRADE – INNER TIER
Anchor Point @ 136’12
————
Trap Trade:
)))1st Peak @ 136’23 – 1400:00 (1 min)
)))11 ticks

)))Reversal to 136’14 – 1400:02 (1 min)
)))-9 ticks

)))Pullback to 136’22 – 1400:11 (1 min)
)))8 ticks

)))Reversal to 136’02 – 1401:19 (2 min)
)))-20 ticks
————
Continued Reversal to 135’23 – 1404 (4 min)
31 ticks

Pullback to 136’10 – 1423 (23 min)
19 ticks

Reversal to 135’18 – 1541 (101 min)
24 ticks

Trap Trade Bracket setup:
Long entries – 136’04 (No SMA / Pivot near) / 135’28 (just below the OOD)
Short entries – 136’20 (just above the HOD/R1 Pivot) / 136’28 (above the R2 Mid Pivot)

Notes: The FED chose to continue tapering QE3 by $10B as expected down to $15B a month, saying nothing significant has happened to cause a deviation from the course of action. They also pledged to maintain interest rates low for a considerable time after the QE ends. This caused a long move of 11 ticks instantly followed by a retreat of 9 ticks, then a pullback after 9 seconds that collapsed nicely after that. This would have filled you inner short entry with 3 ticks to spare, then worked out well as it fell into the :02 bar allowing about 17 ticks to be captured where it hovered. Though more ticks could have been captured by waiting, we strongly advise getting out quickly after the initial reversal and first sign of hovering as all following action is unpredictable. It continued to fall another 11 ticks in the next 2 min to reach the S1 Pivot. Then it pulled back 19 ticks in 19 min back to the 200 SMA / PP Pivot. After that it reversed to the S2 Mid Pivot in the next 80 min as it headed into the session close.

1/28/2015 FOMC Statement / FED Funds Rate (1400 EST)
Forecast: n/a
Actual: n/a
TRAP TRADE – DULL NOT FILL
Anchor Point @ 150’06
————
Trap Trade:
)))1st Peak @ 150’03 – 1400:14 (1 min)
)))-3 ticks

)))Reversal to 150’08 – 1400:28 (1 min)
)))5 ticks

)))Pullback to 149’31 – 1402:01 (1 min)
)))-9 ticks
————
Reversal to 150’21 – 1408 (8 min)
22 ticks

Continued Reversal to 151’18 – 1518 (68 min)
51 ticks

Trap Trade Bracket setup:
Long entries – 149’28 (just below the PP Pivot) / 149’19 (just above the OOD)
Short entries – 150’11 (just above the HOD) / 150’18 (above the R1 Pivot)

Notes: In the aftermath of the end of QE3, the FED chose to take a patient approach to hawkish moves and wait to let the economy continue to recover. This caused an initial dull reaction that fell 3 ticks, then reversed 5 ticks followed by a pullback of 9 ticks. In all it was slow developing and only strayed 7 ticks from the origin after 2 min. Cancel the order after 20 sec with no fill to be safe. After the short move on the :03 bar, it reversed 22 ticks in 5 min to cross the R1 Pivot, then continued to step higher for another 29 ticks in the next hour to cross the R2 Pivot.

4/29/2015 FOMC Statement / FED Funds Rate (1400 EDT)
Forecast: n/a
Actual: n/a
TRAP TRADE – INNER TIER
Anchor Point @ 159’19
————
Trap Trade:
)))1st Peak @ 159’06 – 1400:30 (1 min)
)))-13 ticks

)))Reversal to 159’15 – 1400:52 (1 min)
)))9 ticks

)))Pullback to 159’07 – 1401:04 (2 min)
)))-8 ticks

)))Reversal to 159’30 – 1403:25 (4 min)
)))23 ticks
————
Continued Reversal to 160’05 – 1407 (7 min)
30 ticks

Pullback to 159’18 – 1410 (10 min)
19 ticks

Trap Trade Bracket setup:
Long entries – 159’12 (just below the S2 Mid Pivot) / 159’04 (No SMA / Pivot near)
Short entries – 159’27 (just above the S1 Pivot) / 160’03 (No SMA / Pivot near)

Notes: The FED left open the possibility of a rate hike in June, but stated it was unlikely to be until the end of the summer. This caused the expected instability with a 13 tick short spike in 30 sec followed by the reversal. This would have filled the inner short entry right at 19 sec just before the time recommended to cancel. Then you would have seen it continue to fall and cross the 100 /200 SMAs but come up about 3 ticks short of the outer tier. Then it reversed 9 ticks and hovered about 1-2 ticks in the green briefly to allow a quick exit. You could have gotten out there or waited until after it fell again. Upon seeing it pull back to the same low and start to reverse, it would have been prudent to move the outer long entry up to get a fill around the 200 SMA. Then it reversed 23 ticks in 3 min and another 7 ticks in 3 more min to allow plenty of profit to be captured. Also notice that the reversal distance from the origin was roughly the same as the original spike heading short. After the reversal, it pulled back 19 ticks in only 3 min to cross the 50 SMA. After that it chopped sideways and the moves became less discernible.