How do you trade Fed Days?

I'm interested in hearing other traders' approaches to Fed Days. I was reading a trading blog earlier today and this trader said that he takes off the days before and the Fed day.

I think that could be a sensible approach. Every trader needs a break and if there is a lull in the market (the day or two before Fed Day) and then crazy action on Fed Day, then that's not a bad time to take 3 days off and you can do that 8 times a year.

This obviously assumes that you cannot or do not want to trade the Fed Day.

I have also heard rumors about traders who ONLY trade Fed Days and make enough money off the 8 Fed Days for the whole year. I don't believe those rumors but hey, it's a nice thought that you could understand the Fed Days so well that you clean up each time one happens.

Anyway, what is your approach to a Fed Day?

I take the days off, in my experience the markets don't move enough to trade. Recently I have been looking for other markets to trade during the slow US market.

Are you just looking for other markets for Fed Days or generally when the US market is stagnant? The reason that I ask this is that it's difficult to get to know another market if you are only trading it a few times a year when the US markets are quiet. At least for me it is.

Any trading day the market is going to go up, down or sideways...

People/traders make too much of Fed annoucement days. Now that I have 1.75 year trading...and a winning trader only in the last 4 months ( yes did the daytrading chitlin circuit with the same old same crap...lost money over and over ) I just wait for the reaction on Fed announcements days.

The market will either go up or down depending on the news..and then I wait the next day or two to determine if we are low or high and then go long or short for the big moves...easier that way.

Balance in the Market...is the key...and only the big boys know it...why fight them..let them tell me how they going to fake the retail daytraders...

So tommorrow, I gone Fishing...so to speak...Too much noise in the market..not a good thing...

I gone to eat fish tommorrow not become fried fish...

Good luck with the fishing pips2007 - let us know what you caught.

First of all nobody knows wich way the market is going to go on any trading day.This is gamble and you are better off going fishing but if you cant sit on your hands untill the market settles. Put a buy stop above the ten minute candle and a sell stop below just before the announcement. which ever one trigger becomes your position and the other becomes your stop. Most of the time this wont work because the stop is to far away.And if you jumpin without that stop your in for a roller coaster ride. GOOD LUCK

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Originally posted by day trading

Are you just looking for other markets for Fed Days or generally when the US market is stagnant? The reason that I ask this is that it's difficult to get to know another market if you are only trading it a few times a year when the US markets are quiet. At least for me it is.

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I am looking into FOREX for any time the US market is stagnant not just Fed days/week although it was the primary reason for me looking.

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Originally posted by seeno73

...but if you cant sit on your hands untill the market settles. Put a buy stop above the ten minute candle and a sell stop below just before the announcement. which ever one trigger becomes your position and the other becomes your stop. Most of the time this wont work because the stop is to far away. And if you jumpin without that stop your in for a roller coaster ride.

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I've tried this before a couple of times on a Fed day but not using the 10 minute candle but rather a 1 or 2 point difference outside of the last traded price just before the announcement.

As you know the market goes almost completely flat and dead just before the announcement so it's easy to calculate 4 to 8 ticks above and below and place stop orders. I tried this a while back and the 2 times (I think that it was 2) that I used it I got filled and then stopped for a 2 to 4 point loss almost immediately so it's never worked for me.

Even on the last FOMC day it would not have worked as most people would have been stopped on the move down before it took off on the upside.

Like I said ,lets go fishing:)