FED Reports | JO Bracket Breakout

CL 05-13 (1 Min) 4.4.2013

FED Chairman Speeches Comments Off

May 052013

4/4/2013 FED Chairman Bernanke Speech (1030 EDT)
Forecast: n/a
Actual: n/a
SPIKE/REVERSE
Started @ 93.22
1st Peak @ 93.41 – 1031 (1 min)
19 ticks

Reversal to 92.75 – 1041 (11 min)
66 ticks

Notes: FED Chair Bernanke spoke about the financial and economic education at the Redefining Investment Strategy Education Conference in Dayton, via satellite. He did not discuss QE3, so there was not much to excite the market on this event. With JOBB, you would have filled long at about 93.29 with 2 ticks of slippage. The market was already engaged in a short move, so it went against the grain and crossed the 100 SMA and found resistance at the 20 SMA. Since the market was in a downtrend and it was unable to close above the 20 SMA, move the stop up to the 100 SMA, then look to exit around 93.39. You would have taken 10 ticks or been stopped with 1 tick profit. The reversal continued with the downtrend nearly down to the LOD for 66 ticks. Then the market corrected back to the intersection of the 50 and 100 SMAs, before falling again.

CL 05-13 (1 Min) 3.25.2013

FED Chairman Speeches Comments Off

May 052013

3/25/2013 FED Chairman Bernanke Speech (1315 EDT)
Forecast: n/a
Actual: n/a
UPWARD FAN
Started @ 94.03
1st Peak @ 94.14 – 1316 (1 min)
11 ticks

Final Peak @ 94.90 – 1424 (69 min)
87 ticks

Reversal to 94.50 – 1530 (135 min)
40 ticks

Notes: FED Chair Bernanke spoke about the monetary policy and global economy, strongly defending the dovish policies of easing and historically low interest rates. This caused a moderate weakening of the dollar and a corresponding rally in oil. With JOBB, you would have filled long at about 94.10 with 2 ticks of slippage. It initially hit the R1 Pivot at 94.13, where the 1st peak terminated, then it kept climbing for the next hour or so for 87 total ticks, riding the 13 and 20 SMAs except for 1 dip near the end of the move to the 50 SMA. I chose to exit at the 100 SMA as I had to leave, but there were many better later exit points if you were patient, monitored the dollar, the SMAs, and the MACD. You could have exited around the :46 bar when it hit the 200 SMA or on the dip through the 20 SMA and MACD crossing around 1410. The market reversed for 40 ticks after the pit close culminating at 1530.

CL 02 13 (1 Min) 01.16.13

Beige Book Comments Off

Jan 162013

1/16/2013 FED Beige Book (1400 EST)
Forecast: n/a
Actual: n/a
DULL REACTION then SPIKE WITH 2ND PEAK
Started @ 93.96
Traded between 93.85 and 93.98 for 14 min
range of 13 ticks

Final Peak @ 94.31 – 1430 (30 min)
35 ticks

Reversal to 94.12 – 1434 (34 min)
19 ticks

Notes: The Federal Reserve said today that the U.S. economy was expanding at a moderate pace last month, but faster than the pace of several months. This prompted analysts to expect the status quo for central bank action, thus generating little fireworks. Initially the report was stuck in a tight range with a short term low as the floor and the R1 as the ceiling for about 13 min. After that, it tested the short term low and bounced higher, fighting through all the major SMAs and the R1 Pivot for a final peak of 35 ticks as the pit closed. With JOBB, you would have cancelled the order after a dull 3 min. With little movement in the DX it was difficult to discern which way the eventual breakout would go. Once it broke through the R1 Pivot and 50 SMA, it was free to continue moving higher. It eventually peaked 5 ticks below the HOD. The reversal fell 19 ticks in the following 4 min nearly back to the 200 SMA after the pit closed.

CL 01 13 (1 Min) 11.28.12

Beige Book Comments Off

Nov 282012

11/28/2012 FED Beige Book (0900 HI time / 1400 EDT)
Forecast: n/a
Actual: n/a
DULL REACTION then UPWARD FAN
Started @ 86.23
Traded between 86.16 and 86.29 for 17 min
range of 13 ticks

Final Peak @ 86.74 – 1055 (115 min)
51 ticks

Reversal to 86.57 – 1146 (166 min)
17 ticks

Notes: The Federal Reserve said today that the U.S. economy was expanding at a measured pace last month, even as the northeast and Atlantic states were hurt by hurricane Sandy. Initially the report was stuck in a tight range in the middle of all 3 major SMAs in a tight fist with the S2 Pivot providing a floor at 86.16. After 17 min, the bulls finally broke loose to cause a modest rally of 51 ticks in the next 100 min. With JOBB, you would have cancelled the order after a dull :01 bar. With little movement in the DX it was difficult to discern which way the eventual breakout would go. Once it broke through the technical level of 86.38, it was free to continue moving higher. It eventually eclipsed the S1 Pivot by 6 ticks and could go no higher. The reversal fell only 17 ticks in the following hour as the trade volume dried up late in the US session.

CL 01 13 (1 Min) 11.15.12

FED Chairman Speeches Comments Off

Nov 152012

11/15/2012 FED Chairman Bernanke Speech (0820 HI time / 1320 EST)
Forecast: n/a
Actual: n/a
SPIKE WITH 2ND PEAK
Started @ 84.88
1st Peak @ 85.13 – 0826 (6 min)
25 ticks

Reverse to 84.98 – 0828 (8 min)
15 ticks

2nd Peak @ 85.53 – 0852 (32 min)
65 ticks

Reversal to 85.07 – 0908 (48 min)
46 ticks

Notes: FED Chair Bernanke spoke about the challenges to the housing and mortgage markets. Mostly a glim outlook caused a moderate weakening of the dollar and a corresponding rally in oil. With JOBB, you would have filled long at about 84.93 with no slippage. If you were patient, you could have exited on the :25 or :26 bars with 7-15 ticks. The market reversed for 15 ticks to close the gap to the 13 SMA , then rallied for a stepping final peak of 65 ticks 32 min after the speech started, nicking the 200 SMA. The reversal reclaimed 46 ticks, bottoming on the 100 SMA 16 min later. Then it chopped higher for a double top and more.

CL 12 12 (1 Min) 10.24.12

FOMC Statement Comments Off

Oct 242012

10/24/2012 FOMC Statement / FED Funds Rate (0815 HI time / 1415 EDT)
Forecast: n/a
Actual: n/a
SPIKE/REVERSE
Started @ 85.77 (0815)
1st Peak @ 85.49 – 0818 (3 min)
28 ticks

Reversal to 85.97 – 0819 (4 min)
48 ticks

Notes: Report released on time, as the FED chose to continue the existing open ended QE3 policy despite seeing certain indications of improving economic conditions. This caused both the CL and the DX to seesaw over several minutes between the 200 SMA on the low end, and the S1 Pivot on the high end. This would have been an ideal report for a trap trade with a span of about 40 ticks. Notice how the volume dried up and the range tightened as the pit closed at 0830, 15 min after the report released.

CL 11 12 (1 Min) 10.10.12

Beige Book Comments Off

Oct 102012

10/10/2012 FED Beige Book (0800 HI time / 1400 EDT)
Forecast: n/a
Actual: n/a
SPIKE WITH 2ND PEAK
Started @ 91.91
1st Peak @ 91.77 – 0801 (1 min)
14 ticks

Reversal to 91.98 – 0802 (2 min)
21 ticks

2nd Peak @ 91.02 – 0823 (23 min)
89 ticks

Reversal to 91.40 – 0832 (32 min)
38 ticks

Notes: The Federal Reserve said today that the U.S. economy was expanding “modestly” last month, supported by improvements in housing and auto sales, even as the labor market showed little change. Initially the report was modestly positive overall and caused a small uptick in the DX, resulting in a meager short spike of 14 ticks, crossing the 50 SMA and the PP Pivot briefly. Then it rebounded and traded sideways for 15 min between the 50 and 100 SMAs, before heading south for the 2nd peak of 89 ticks on the :15 – :23 bars as the DX rallied strongly. With JOBB, you would have filled short at 91.82, then had an opportunity close out with a handful of ticks. With the previous hour or so showing strong support at and below the PP Pivot, do not get greedy on this and look for more ticks. The longer term reaction was able to deliver a bigger yield which is often the case with this report. Ensure you are flat by 1430 when the pit closes.

CL 11 12 (1 Min) 10.01.12

FED Chairman Speeches Comments Off

Oct 012012

10/1/2012 FED Chairman Bernanke Speech (0630 HI time / 1230 EDT)
Forecast: n/a
Actual: n/a
SPIKE/REVERSE
Started @ 92.50
Peak @ 92.21 – 0639 (9 min)
29 ticks

Reverse to 92.59 – 0647 (17 min)
38 ticks

Notes: FED Chair Bernanke was on the defense this time in response to the critics of QE3. He vigorously defended the action taken as necessary and helpful and denied that the FED was enabling bid deficits. After the :31 bar rose for a few ticks, the market fell into a methodical 29 tick dive over 8 bars to nearly hit a double bottom at the 92.20 area from almost an hour earlier. The small rise initially hit the 100 SMA and fell, slicing through the 50 SMA. With JOBB, if you had not cancelled the order, you would have filled at about 92.43 short with no slippage. After it encountered mild support at the 50 SMA, I would close out at about 92.28 on the :35 bar for about 15 ticks. The reversal basically reclaimed the drop, crossing the 100 and 50 SMAs in 8 min after the peak for 38 ticks. Then it repeated the cycle and seesawed on either side of the 50 and 100 SMAs on top of each other.

CL 11 12 (1 Min) 09.13.12

FOMC Statement Comments Off

Sep 132012

9/13/2012 FOMC Statement / FED Funds Rate (0630 HI time / 1230 EDT)
Forecast: n/a
Actual: n/a
SPIKE/REVERSE
Started @ 97.67 (0631)
1st Peak @ 98.74 – 0632 (1 min)
107 ticks

Reversal to 96.84 – 0638 (7 min)
190 ticks

Notes: Report released 1 min late, but the FED finally acted, executing QE3 by unleashing an open ended mortgage backed bond buying program at $40 Billion/month. As this caused heavy volatility based on the dollar, we saw a long spike of more than 100 ticks crossing all 3 major SMAs and the R1 Pivot. The large gain was outmatched by the successive collapse in the next 7 min of 190 ticks. It continued to swing largely up and down even after the pit closed at 0830. With nearly 200 ticks range on the swings, this is a good opportunity to buy the dips only. Since the dollar will be falling, the overriding influence on the CL will be bullish, so buy the dips – 0638, 0653 (at the PP Pivot), 0803 (on the 100 SMA). Also notice the peak on the 0828 bar is a double top with the 1st peak @ 0632.

CL 10 12 (1 Min) 08.31.12

FED Chairman Speeches Comments Off

Aug 312012

8/31/2012 FED Chairman Bernanke Speech (0400 HI time / 1000 EDT)
Forecast: n/a
Actual: n/a
INDECISIVE
Started @ 95.93
Peak @ 96.14 – 0401 (1 min)
21 ticks

Reverse to 94.91 – 0408 (8 min)
123 ticks

Recover up to 96.04 – 0422 (22 min)
113 ticks

Notes: Factory Orders broke at the same time and resulted in the biggest rise in a year. This caused the the long spike of 21 ticks on the :01 bar. The spike crossed the 100 SMA and then hit resistance just below the R2 Pivot and 50 SMA causing it to bounce lower. As the speech was being delivered to the Economic symposium, the perception was initially hawkish as the dollar rallied and stimulus was downplayed. This caused the CL to selloff. Then after 10 min, the perception changed resulting in the dollar falling and oil rallying. If factory orders had not released at the same time, the market would have simply fallen for about 10 min, then rebounded without the long spike on the :01 bar. Nothing shocking to the market enough to cause a significant reaction. In this case the JOBB would not have filled after 10 sec, so cancel the order. If you did not cancel before you got filled, then move the stop in tightly and try to close with a small profit or loss (3-5 ticks).

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