I, of course, would like to make as much as profit as possible on Wednesday’s FED decision. However, I would like to do this without getting my account wiped out.
In my opinion the movement will be huge. There are many rumors going on, nobody knows what the reaction of the USD will be.
How about place a buy order 15 pips above EURUSD price 15 seconds before the decision and a stop 50 pips lower AND
a buy order 15 pips above USDJPY price and a stop 50 pips lower at the same time?
Note: ZeroHedge published that Americans are long on the dollar for an amount of 3 billion USD and that they may get margin call all of them on Wednesday.
My thoughts are that the EURUSD will rally. Why? If they don’t hike, it’s quite obvious EURUSD will shoot up straight into heaven and hit 10 million+ stop losses (analysts estimate the chance of a hike is 80%). If they do hike, there will be probably a guidance that they will do it “at a very slow pace” which may also lead to a strong rising EURUSD and of course profit takings will make the move stronger + the same stop losses getting hit…
Greetings,
Bart
I’m surprised to see there is no thread about this topic yet, or I miss it.
[QUOTE=“Bartowke;737470”]Hello, I, of course, would like to make as much as profit as possible on Wednesday’s FED decision. However, I would like to do this without getting my account wiped out. In my opinion the movement will be huge. There are many rumors going on, nobody knows what the reaction of the USD will be. How about place a buy order 15 pips above EURUSD price 15 seconds before the decision and a stop 50 pips lower AND a buy order 15 pips above USDJPY price and a stop 50 pips lower at the same time? Note: ZeroHedge published that Americans are long on the dollar for an amount of 3 billion USD and that they may get margin call all of them on Wednesday. My thoughts are that the EURUSD will rally. Why? If they don’t hike, it’s quite obvious EURUSD will shoot up straight into heaven and hit 10 million+ stop losses (analysts estimate the chance of a hike is 80%). If they do hike, there will be probably a guidance that they will do it “at a very slow pace” which may also lead to a strong rising EURUSD and of course profit takings will make the move stronger + the same stop losses getting hit… Greetings, Bart I’m surprised to see there is no thread about this topic yet, or I miss it. Greetings and all the best, Bart[/QUOTE]
for me, I’ll say use a 0.01 lot size if you must trade and see the outcome. these days traders GI against the news as with the case of GBP rate votes, USD retail sales and off course the almighty EUR. since last week it has been news saying one thing and market doing another. so use the smallest lot size.
@fxpipnoichi, I think I will not execute my plan, though I think I will trade but only when the direction is clear and volatility decreased. AND with a normal number of lots. That will be then after 7.30 (8.30 here). What I learned already is that when the direction is clear, the move doesn’t stop until close of Wall Street at least. Then it cools down during Asian session, and then when European markets open the trend of the previous day continues as traders need to close and reposition. Or has anyone got contrary examples of strong moves in EURUSD after ECB or FED decision? @pipmehappy, cool to hear that you will make a video. And I will read the article about the FED decision tomorrow when I’m back fresh, it’s a long one I will also look tomorrow at your video on the RBNZ rate decision. That was also a weird move…(because of the press conference) Indeed, almost forgot that it is not only the statement but also the press conference :/. Wow this event will be so huge. Maybe we will write history. During that press conference, volatility will hit record levels. EURUSD will go 100 pips/second ^^. Every word that she says will be evaluated and interpreted in the light of what the path is they will follow. HFT’s will go crazy, processors will explode ^^
I’m bearish on the USD. No matter what decision comes out, there’s alot of bearish pressure out there. USD longs may use the event to take profit before the year ends. A hike may already be priced in, so there may be no more buying. A decision to hold is likewise bearish. This is a widely-anticipated major event, so there’ll be some fireworks, no matter what happens.
If your broker allows options trading and you’re convinced there will be a massive move but you don’t know which direction consider an options straddle strategy
you buy both a put and a call with the same expiry date. if the move is big enough the profit on whichever one is right will more than make up for the loss on the wrong one
slippage won’t be an issue, your risk is limited to the options premium. worst case is the price doesn’t move at all and you lose both premiums
do a google search for Options Straddle and read up on the strategy
I will also look tomorrow at your video on the RBNZ rate decision. That was also a weird move…(because of the press conference) Indeed, almost forgot that it is not only the statement but also the press conference :/. Wow this event will be so huge. Maybe we will write history. During that press conference, volatility will hit record levels. EURUSD will go 100 pips/second ^^. Every word that she says will be evaluated and interpreted in the light of what the path is they will follow. HFT’s will go crazy, processors will explode ^^