FOMC Announcement can cause volatility in any direction

07/29/2020 09:04 AM By Brian Casto
FOMC Announcement Day can bring some volatility to the Futures Indices, with great sensitivity to the opening price location.  When gapping up and exiting at the close, taking a Long approach will likely produce a Bearish result.  A Gap Fade approach, targeting the prior day close, may work better.  Check out the setup below and watch the video.  Make your comments below.

Opening Gap Direction - Up

Market Status - Today is the FOMC announcement at 2pm.  We are trading higher this morning as we approach the open

Instrument - ES, NQ, YM, RTY

Trading SetUp - Intraday Open & Gap Fill (Fade)

Market Trend - Above the 200 Day Moving Average (200MA)

Trade Type - Long & Fade (stop at 40% of the 5 Day ATR)

Entry - 9:30 am ET (Market Open)

Exit - 4:15 pm ET (Market Close)

Brian Casto