Trading With The News - Federal Reserve Announcement

Usually trading through announcements isn't a great idea. It's hard to know how the trading herd will react. But once you start to understand the art of options trading, then you can trade during earnings, news and other announcements with ease and confidence.

The Week
Last week I was at the Biohacking Conference. This week was all about recovering from a back
injury and a cold. I feel like my whole immune system is giving me a raspberry. I didn’t trade
much as my mind was preoccupied with getting well.

If you were an Investing Buddies subscriber you got an email alert several hours before the
Market opened on Wednesday. I was letting you know I anticipated a down Market after the
Jerome Powell’s press conference at 2pm on Wednesday. I shared my plan of action in that
alert.

1. When the Market opened, I exited all my short PUT positions and left all my Long PUTS
in place.

2. Then I waited for the press conference and the herd’s reaction to Powell’s comments.
Most of us are aware of how bad the economy is right now. I believe just speaking it out
loud causes the price reaction

3. Once I saw the herd’s reaction (down hard), it was time to look for trades to buy PUT
positions.

My best advice to you, especially now, is to build the various economic announcement into your
trading plan. We are hanging on by the tips of our fingers and it won’t take much to see big ups
and downs.

Looking Ahead
I think the drama of the past two weeks will subside and the Market will be a little more calm.
Right now the overall Market is at E’s for Accumulation/Distribution. I expect a herky jerky, up
and down movement for this coming week as everyone tries to get some traction again. Sill a
slippery slope but I still think we have seen the hard down already.
How did I do this week?
I only placed 7 trades this whole week but still managed to bring in $3,232 in profits – 4.6% gain