CPI Delivers Volatility, But Now What? July 14th Trade Plan

In yesterdays post, I spoke about how a volatile day was coming thanks to the CPI Inflation Report at 830AM, and volatility certainly delivered. In many ways today was an exercise in what the typical “data” day looks like. I wrote yesterday: “This is why after the vast majority of CPI reports, NFP reports, or FOMC days, there is an initial “trap” reaction”. We certainly got it today, with ES plunging nearly 100 points in the hour after the report came out (the trap move) only to rally the rest of the day and retrace the majority of it.

The problem? After all that, we are essentially unchanged at the same price we were yesterday at this time. Why? Because we are ultimately still just consolidating and have been since June 27th. The market is still setting up its next sustained trend leg.

In todays newsletter, I’ll talk how I traded today in relation to yesterdays trade plan (mistakes included), talk the pattern forming here which is now very well defined, and talk long/short triggers for rest of week