Observation: the USD falls when interest rates decrease and gold falls when the USD rallies and vice versa. So based on that logic, and the consensus quarter point rate decrease, I set up this long entry on ABX going into the policy statement. It was basically a no brainer because ABX, was anticipating the move prior to 2:15 EST. That's approx. 2R on the extension to R2. The intial stop is wide (red line segment) because of anticipated post FED choppiness.
As you can see from the 1 min. chart of the QQQQ above, the initial FED reaction was very choppy. But as I said in last night's NASDAQ post, the consensus 1/4 pt. rate cut with potential pause going forward would not result in a market rally. After a lot of back and forth, triangle type action, I shorted the Qs and added to my position on a mini bear flag a short time later. I covered as a base started to form at the $47.20 level.
Observation: the USD falls when interest rates decrease and gold falls when the USD rallies and vice versa. So based on that logic, and the consensus quarter point rate decrease, I set up this long entry on ABX going into the policy statement. It was basically a no brainer because ABX, was anticipating the move prior to 2:15 EST. That's approx. 2R on the extension to R2. The intial stop is wide (red line segment) because of anticipated post FED choppiness.
As you can see from the 1 min. chart of the QQQQ above, the initial FED reaction was very choppy. But as I said in last night's NASDAQ post, the consensus 1/4 pt. rate cut with potential pause going forward would not result in a market rally. After a lot of back and forth, triangle type action, I shorted the Qs and added to my position on a mini bear flag a short time later. I covered as a base started to form at the $47.20 level.
7 comments:
very nice trade.
cheers
Thanks PRD
Very nice Jamie!
Thanks Anarco
Ok ok.. we all know your da man. I think the key take away from this post is not to lock yourself into a small field of vision (i.e. technical charts only), but to have a good sense of the macro economic enviornment as well. If a trader is able to see what sectors or markets effect one another, it would greatly improve their results. Sounds like a no-brainer, but its something I need to work on and I'm sure many others as well. Great execution Jamie.
Cheers.
Nice trades Jamie !!
Wish I have a chat room with you and other traders who trade these kinds of setups.
But I do well too.
Thanks guys
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