Here is an interesting trade I took the other day. Thought I'de share this strategy.
The chart below shows Feb. 14th, 2007, the day Bernanke spoke at 10:00am EST. Now the markets did absolutely nothing until 10am. Everyone was waiting for Bernie to speak. On Fed days the markets usually do 1-2-3 move. (1-2-3 moves are... initial move up/down, reversal, and then third wave back in the original direction). However on Bernie speeches, the markets tend to just GO. The key to playing these moments is to get in early and not chase. Moves are usually very fast on the YM and they can take off over 30+pts in a matter of seconds.
Okay.... lets get back to the chart. Price stalls right above value high pivot using it as support twice. The YM is pretty much stuck in a 15pt range from 12685 to 12700. Now what I did was use a bracket order with a buy stop at 12705 and a sell stop at 12680. The strategy is to get in asap in the direction of the move.
The important part is in this strategy is to pick your buy and sell levels carefully. Why 12680 and 12705?? 12683 is value high. My sell stop is placed 3 ticks below this value high pivot. The play would be to ride it down to value low at 12651.
Now, take a look at the chart below. 12703 is 2/9/07, Fridays high. 12700 is also a key psych level making this mark extra key. So my buy stop is placed at 12705.
The markets did go and rally for about 30pts after the Bernie momo breakout and another 30pts in the afternoon. Take a look at your past charts, practice it, and tweak it. It's a pretty easy strategy but the key is picking your two buy/sell levels.