March 18, 2009 <\/a><\/li>\n<\/ul>\n\nThe most important part of the minutes will be the wording.\u00a0 The rates won’t be cut (we’re already at our lowest rate) and they won’t be raised (we’re in the middle of a deflationary cycle where raising interest rates would kill any hope of a recovery and send us for sure into a second depression).\u00a0 So that leaves the wording.
\n
\nIf you look at the 3rd paragraph of the March 18th release, they discuss actual numbers for the programs they plan to implement.\u00a0 Up until that point, we had no idea how big the programs were going to be.\u00a0 They said they intend to increase the purchasing of MBS, longer term treasuries, and agency debt.\u00a0 I’m not sure how much of this has actually been purchased already, and whether or not the programs need to be expanded just yet.\u00a0 I’m not sure if the numbers are out of exactly how much of the program they have spent.\u00a0 If someone has that info, that would probably be pretty helpful.\u00a0 If they expand the programs further I would expect another pop.\u00a0 If they don’t expand the programs, we could stay flat or sell off.
\n
\nLast release, the move in commodities, particularly precious metals was extraordinary.\u00a0 Gold was hovering above 880, and closed the NY session at 950.\u00a0 FCX rose from 34 to 38 in that time period.\u00a0 All miners were on fire.\u00a0 Financials had a nice pop, but the extended move was in precious metals.\u00a0 Why?\u00a0 Because basically the Fed is beginning an inflationary cycle which at some point in the future will catch up to them.\u00a0 On the announcement, the key levels in gold will be 920 and 950 on the upside and 880 and 859(200 dma) on the downside.
\n
\nI think if the market reacts negatively to the announcement we would see extended selling in the financials, and if it reacts positively we would see extended buying in precious metals.\u00a0 I think both will move on a strong reaction either way, so on the initial move I will probably trade financials.\u00a0 Then I will decide which of the two sectors I will continue to trade based upon what I expect and how they are reacting.<\/p>\n","protected":false},"excerpt":{"rendered":"
\u00a0Below are the last two FOMC statements: January 28, 2009 March 18, 2009 The most important part of the minutes will be the wording.\u00a0 The rates won’t be cut (we’re already at our lowest rate) and they won’t be raised (we’re in the middle of a deflationary cycle where raising interest rates would kill any hope of a recovery and … Read More<\/a><\/p>\n","protected":false},"author":167,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[30,18,301],"class_list":["post-542","post","type-post","status-publish","format-standard","hentry","category-general-comments-2","tag-prop-trading","tag-smb-capital","tag-trading-blog","no-post-thumbnail"],"yoast_head":"\nMy FOMC Game Plan | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/my-fomc-game-plan\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"My FOMC Game Plan | SMB Training\" \/>\n<meta property=\"og:description\" content=\"\u00a0Below are the last two FOMC statements: January 28, 2009 March 18, 2009 The most important part of the minutes will be the wording.\u00a0 The rates won’t be cut (we’re already at our lowest rate) and they won’t be raised (we’re in the middle of a deflationary cycle where raising interest rates would kill any hope of a recovery and ... 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