FOMC day? Are you prepared? Trade Ideas for Wed Jun 18
What's stopping you from making 500-1000%? Stop overtrading, and make more in less time. Read on to learn how I do it.
Good morning. Today is FOMC day. Don’t trade it the wrong way. It usually a day full of faker moves. Use those moves to your advantage. We also may get some large range especially if the Fed does the unexpected. I believe I saw a report saying that 99% certainty the Fed leaves rates unchanged. So what happens if they cut? Make plans…. In the Ideas section I’ll share mine.
As for yesterday, neither my bull or bear scenarios really setup. That said, I did have a good read on what would happen but poor execution. When that happens, I don’t just say oh well. I review the trade to see what could I have done differently or better.
I’ll share that analysis in the recap below.
SPY / SPX
IDEA: SPY 601.50 turns into resistance target 596.80
This idea formed after seeing the first 60 minutes of price action. We see 601.50 reject and the 10:30 level rejected. So we go short. Reaching vwap. I chose 5980p at 2 risk to 1.50. It got to 2.60 before getting stopped out after vwap held. No big deal. At this point I believed that we moved into consolidation mode.
With that mindset even after seeing the 11:15 failed breakout, I wasn’t convinced theat we would get downside follow through. Sure enough if I did go short again on 5980p at 1.25 the most it got to was 2.50.
At this point I should have considered SPX 6030/35 bear calls. This was one error. The second was not switching to target based risk/reward pricing. Instead of focusing 5980p I should have been focused on 6000p.
With target based pricing I had 15-25 potential using 5978 as the target. So I should have done 15/5 = $3 (gives me minimum 400% potential return). And placed orders at low of day at 2.50 and starter at 3 on 6000p. Let’s look at that chart.
The alternative trigger for entering the trade was at 12:45pm. But this was my lunch hour and so I missed it.
So here is the analysis. During lunch we had a large volume signal come in. We then got 601.50 rejected again, followed by a vwap break, and back test of the high volume level and draw my the solid cyan blue line.
In Green on the 6000p chart you can see how the entry would be $3-3.50. Once SPX got to 596.80. the 6000p hit $25!!!
The levels are incredibly precise. Unfortunately the timing was not and I missed this play.
The reason I share the logic above is my focus on two hour trading. The target based pricing method is less “sure” but would have allowed to trade my thesis/scenario without watching charts.
The second method requires active monitoring until I can create an algo to look for these conditions and alert me. There was a 4 minute window from time of high volume level break and vwap break to take action and enter at the “right” time for insane risk/reward.
Spectre Special
This was difficult. I had 2 to 3 trades that I took 50% profit at 100% gain for washes and then alerted a plan to take 5980p for 0.30. That filled and within minutes spiked to 1.50-2 for exits before ending at 0.
0.30—>1.50 = 400%!!! PROFIT!
There is massive opportunity in this market. Are you taking advantage? Literally have planned and alerted trades that pay over 300-1000%! You will need patience to wait for entries and the exits. But if you have self discipline or trust bracket orders, my process can help you get the results you want.
Thoughts from Tuesday’s price action:
SPY is consolidating around this 598-602 area
No clear signal yet for upside or downside next
BTFD bias continues until 592 breaks.
What is Two Hour Trading?
Two Hour Trading is my system for finding and executing trades while spending less than two hours a day trading. My goal is to earn 100-300% on the capital I risk while waiting for 1000%+ gain trades to set up. Key benefits include:
High-quality trades with excellent reward vs. risk
Avoiding overtrading and losses from it
Trading to win vs. trading not to lose
Stacking the deck in your favor
If you are busy and want to see my commentary and ideas in real time consider joining THT-PRO.
Education
How to Join a Strong Trend
The process I typically follow for joining a strong trend are as follows:
All day grinder: join on dips to 20ma
Multi-day grinder:
Join either on support test of morning lows or failed breakdown reversal at key level
Join at VWAP mid day or end of day
Keep it simple. Don’t chase, wait for support levels for great risk/reward entries!
Systematic Profit Taking
How do I take profits? I keep it relatively simple. Depending on the entry and range to the next levels I typically with take profits 50-100% of my profits at 3-10R and then raise stops to above entry with a goal of letting runners take me to the next level or 2 and to then reload if I believe we are consolidating before the next leg.
I then repeat the same process on the reload.
Securing Profits on Options overnight
Sometimes you get this massive paper gains overnight on options but you can’t secure it right? Well if you have a big enough account and a margin account if you have calls you can. What you need to do is buy or sell the stock overnight. and the option turns into a hedge against that position essentially securing your profits.
Trade Ideas - Plan for Wed Jun 18
Stick to process. The process and trade setups I teach works. Rinse and repeat over and over again. There will be losses. Any good system will have them. Being systematic also means the gains will repeat and come again too. If you keep changing your system/process trying in an effort to never lose a trade, you will never get to where you want to go.
Ideas
Today is FOMC day. Trade smaller. I’ll look for action after first hour or two but we may just chop around and be directionless until 2pm.
I generally avoid trading until after 2:30-2:45pm. This lets a lot of the faker moves do their thing. And I can catch the trend into the close.
Reminder tomorrow is a holiday.
Here is what I’m looking for.