On September 23, 2009, the Federal Reserve Bank of America made the announcement on the interests rates. As often happens, a huge market spike took place right after the announcement, in the form of an upward move.
The ES Hourly RL Odds Calculator gave a signal to go SHORT right at the top of the spike, with a 0.25 error margin.
Here below you can see the ES 60 min. chart showing the upward spike and the following pullback that happened almost EXACTLY on the RL Hourly resistance at 1075.48.
(Please notice that these charts are correctly set for ES closing at the bottom of the hour, i.e. at the 30 minutes - too many traders are completely unaware of the fact that ES does not close at .00 on the 60min. charts, because they use retail trading platforms that provides only the 60 min. Close at .00, no matter what the security is. Go check the CME equotes platform and you will discover that ES Hourly closes at the bottom of the hour).
(Please notice that these charts are correctly set for ES closing at the bottom of the hour, i.e. at the 30 minutes - too many traders are completely unaware of the fact that ES does not close at .00 on the 60min. charts, because they use retail trading platforms that provides only the 60 min. Close at .00, no matter what the security is. Go check the CME equotes platform and you will discover that ES Hourly closes at the bottom of the hour).
(click on the image to enlarge it)
As you can see the Odds Calculators were pointing out that the odds to have a SHORT reversal at 1075.48 where 78.57%.Many traders are usually scared of taking positions on Fed days or other days where the news seems to be ruling, but the truth is that the RL Odds Calculator are able to transcend the events/news.
The RL Odds factor in everything, Fed days, CPI days, Black Swan events, etc., because they include large sets of historical data that already include all sort of events that happened in the past and will happen again in the future.
In other words: the odds are everything, once they're good, the trader should just take the trade and forget all the rest, all the noise that is confusing their trading decision (news, blogs, indicators, EW, TA, etc.).
Following this simple truth, RL Traders yesterday made a boatload of profits, going SHORT on the suggested level, in the face of the Fed and their 'keeping rates low' policy that in theory should have sent the market higher, and in the face of all those who says 'never trade when there are big news coming out'.
The odds are everything, once they are good, trad'em.
Posted by:
The RL Team
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