FOMC Day Delivers The Volatility: Can Bears Keep Going? Sept 22nd Plan

In yesterdays newsletter, I spoke about how a defining feature of FOMC days are trap moves writing “On days like tomorrow, small size, and failed breakdowns are your best friend” and this could not have been truer today. I spoke about the last 4 FOMC’s in a row were all the exact same: Big initial spike down, trap shorts, then squeeze higher. Today delivered big, bi directional traps in a way that only FOMC days uniquely can.

We got the initial spike down and recapture of 3855 which triggered long as per yesterdays newsletter for a 70 point squeeze. This got to 3920 resistance, and then trapped again rejecting back down to the lows of the day. This means a 90 point squeeze to the upside to start, followed by a 120 point squeeze selloff.

Bears won the close, losing critical, multi-day support, but post FOMC days are often just as a volatile as FOMC days. In todays newsletter, I’m going to breakdown how I traded todays wild action via yesterdays plan (there were two clean setups), talk what today’s major failure means, then talk targets and plan tomorrow.