How do you trade Fed speeches?

common guys those speeches are WINNERS , they moving the market just in one direction even before they start to talk , what is happening here.
why big institutions and banks or maybe Bernanke and his friends can have a piece of this cake and we can't ,, can anyone help

Easy... you dont

Helicopter Ben is small fry, Greenspan was the ace!

How about this......

"I know you think you understand what you thought I said but I'm not sure you realize that what you heard is not what I meant" ― Alan Greenspan

lol, seriously, he actually said that!

Regards speeches and press conferences just listen out for the catch-phrase/word of the day, and to know what that is try watching one of the financial news channels ie Bloomberg, they usually have a pre and post speech discussion.

But as traderjai_inhi said, if in doubt - stay out!

Don't expect much change from previous. No hints at QE therefore USD bullish.

ya but is there kind of strategy or mechanism you would follow that help you reducing the risk and increases the gains.

some experts saying that you should trade after the news impulsive effect , like you wait 2 minutes or more and enter with the flow , others saying you should place your order before the news do your researches pick a side and protect your self.

this is mind storm , and i am newbie by sharing ideas we can find the best way ,, so here is mine even if they are bad

in case of no certainty

i thought about opening hedge right before the speech and as it just one way direction move as i noticed when the time come and the price start to move in it way you can close the opposite trade but the problem is the move is very fast and you will lost a big piece of the feast also the big spread won't help.


if you triggered two pending orders right before the news with one or two minutes while the spread still low one buy stop above the current price with about 30 pips and the other one sell stop below the current price with same pips with only trailing stop 5 pips or lower and high volume .

in case you chose one direction i think 20 pips loss is a good edge .

also i suggest trading USD with a robust currency like CHF or gold so you can see significant move and price be less choppy

Whipsaws and spikes can screw with any straddle and stop. If you're hell bent on doing this then take a gamble based on your analysis, hang onto your hat, and hope you were right!

It's not a real trade though, it's just a bit of gambling fun with a small position and money you can afford to burn if it goes wrong.

Speeches and press conferences can be too ambiguous, have a crack at data like NFP or interest rate decisions, they're a real blast!

nb: not suitable for people of a nervous disposition!

thank you pipmutt for ur contributions

This.

They *almost* always go with the current trend, retrace then take off again in the current trend direction. But yeah, not for the faint hearted...

What I've learned in this market is let the big dogs eat their cake, then afterwards, we can go after the crumbs.

With day to day economic releases (CPI/Retail sales/Housing starts and so on) it's more or less impossible to profit from the initial market reaction. This is because institutions develop algorithms that plug into Reuters etc and automatically place orders split seconds after the release. You cannot out-click a computer!

The Central bank statements however are a different animal. The ECB press conference tends to be the most tradable followed by the FOMC statement.
These days central banks tend to keep the wording almost exactly the same each month bar a few key changes that mean EVERYTHING to the market.

Several months ago when Trichet was still the president of the ECB, he changed literally ONE word in his statement to the press. This one word indicated that the ECB would hike rates at the following meeting and sent the Bond markets into free fall and the Euro rallied 100 pips or so. This move was 100% tradable if you have a fast enough connection with one-click-trading and a direct line to the ECB conference.

DO NOT try to listen to CNBC and trade the statement!! A delay of only 1-2 seconds will guarantee you get worked trading this way!

Jonny