Share some simple experiences from the FOMC night,
3:00
In most cases, do not make decisions in the first 1-minute candlestick at 3:00 tonight when data is released; this is where most people tend to lose money.
The reason is simple; the city robots that rush for news releases cannot be outpaced by ordinary people.
Moreover, the market quotes at this time are relatively wide, and the market depth is thin.
At this moment, the reactions are primarily mechanical responses driven by algorithmic trading focusing on keyword triggers, which will later be fully interpreted and corrected.
The best thing to do at this time is to observe the first directional changes of U.S. Treasury yields, the U.S. dollar index, and NASDAQ futures; if the divergence is very obvious, for example, if bonds are hawkish while the stock market is dovish, it indicates that the market is actually very confused, so participate with caution.
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3:30
The press conference half an hour later has the potential to become a golden time for re-pricing, where three key aspects should be noted.
1. The first paragraph of the opening statement, check whether it emphasizes reliance on data or is directly dovish or hawkish.
2. In the Q&A session, see if there are any changes in the tone regarding neutral interest rates, financial stability, and the labor market.
3. Are there any conditional statements, such as, if inflation rises again, we do not rule out raising interest rates again? Such conditional statements can easily be amplified and interpreted by the market.
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Tonight's meeting is the FOMC meeting with economic forecasts and dot plots; compared to regular FOMC meetings, the economic forecasts and interest rate dot plots are even more important.