Another interesting day with some great learning to be had. Multiple news items came into play today. The 10:30 Crude inventories was a huge build but Oil had traded down into the announcement then rallied. The news was “priced in” and it was a good learning moment if you were watching it live.
Everybody knew that the number was going to be negative, Business news was talking about it all morning. It was a case of “sell the rumor and buy the news”.
Later in the day the 2pm FOMC meeting caused major volatility. I was whipsawed out of my long position almost immediately. Then the markets broke down hard (that’s why you need a stop). You can check the analysis for the play by play.
I didn’t play the first breakdown (good example of getting your hand burned causing some pause). I did short the second breakdown after I really nice shake out tail that captured the Bulls. I was ready for the next break and covered using my TICK rules near the bottom of the down-leg.
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