Bitcoin - How to trade the CPI Announcement
TLDR:
I went over the price action of the NY session of every CPI announcement in 2023 and these are the lessons they all have in common:
1. TAKE PROFIT! If your position is in profit, take it, because PA can change on a dime.
2. The first move is the false move. Dump & Pump or Pump and Dump.
3. Sell the range high, buy the range low.
4. Core CPI has more effect on the market than the general CPI number.
5. Generally, if you don’t already have a solid position, it is best to be flat before the announcement
6. If you are not sure about what to do, don't do anything, wait.
7. I know you are busy, but at least take the time to look at each month’s chart (below). Trading Plan for July’s CPI announcement:
• According to Trading Economics, the expectations for this month’s announcement are:
1. Inflation Rate YoY to drop from 4% to 3.1% - 3.2%
2. Core Inflation Rate YoY to drop from 5.3% to 5%.
• If inflation, especially Core CPI drops but not as much as expected. I will be looking for a dump & pump. Accordingly, I will buy at the range low or lower and sell above the range high.
• If inflation numbers are better than expected, I will expect a pump and dump. In this case, I will take profit above the range high at 300$ intervals (I already have a long trade running). In this eventuality, I will decide on the spot, if and when to place a short trade.
• Long Invalidation: below 28.5K
• Short invalidation: above 32. K
Research:
January 2023:
Slightly Better than Expectations
Thursday January 12 2023
Conclusions:
1. If the results are better than expected, we can expect price to increase.
2. Be careful of stop hunts. Wait for the stop hunt before you place a long trade.
3. Take profit if price moves sharply up.
4. Dump & Pump.
February 2023:
Slightly worse than Expectations.
Conclusions:
1. If the overall inflation trend is down, expect a positive effect on price.
2. Don’t be too impressed by the immediate reaction to the announcement.
3. If you caught a big move, take profit.
4. Dump & Pump.
March 2023:
Slightly better than expectations.
Conclusions:
1. If you caught a big move, take profit!
2. If price breaks above the resistance by a wide margin, consider a short trade.
3. Pump & Dump.
April 2023:
Generally, Inflation numbers were better than expected. However, Core CPI was slightly worse than expectations.
Conclusions:
1. Core CPI has a more noticeable effect on PA.
2. If price moves your way, long or short, take profit.
3. NY dumps, Asia pumps.
4. Pump & Dump
May 2023:
Overall, the results were in line with expectations.
Conclusions:
1. TP! TP! TP! TAKE PROFIT!
2. Pump and dump.
3. When the results are in line with expectations, volatility increases (this is just a notion, at this stage, but keep it in the back of your head.
4. Sell the range high, buy the range low.
June 2023:
Inflation numbers were better than expected (including Core CPI).
Conclusions:
1. TP.
2. Sometimes the best strategy is to sit on your hands. This session was for advanced traders.
3. Wait at the edges of the range for opportunities.
NFA.
what do you think? Please share in the comments.
Best Wishes.
I went over the price action of the NY session of every CPI announcement in 2023 and these are the lessons they all have in common:
1. TAKE PROFIT! If your position is in profit, take it, because PA can change on a dime.
2. The first move is the false move. Dump & Pump or Pump and Dump.
3. Sell the range high, buy the range low.
4. Core CPI has more effect on the market than the general CPI number.
5. Generally, if you don’t already have a solid position, it is best to be flat before the announcement
6. If you are not sure about what to do, don't do anything, wait.
7. I know you are busy, but at least take the time to look at each month’s chart (below). Trading Plan for July’s CPI announcement:
• According to Trading Economics, the expectations for this month’s announcement are:
1. Inflation Rate YoY to drop from 4% to 3.1% - 3.2%
2. Core Inflation Rate YoY to drop from 5.3% to 5%.
• If inflation, especially Core CPI drops but not as much as expected. I will be looking for a dump & pump. Accordingly, I will buy at the range low or lower and sell above the range high.
• If inflation numbers are better than expected, I will expect a pump and dump. In this case, I will take profit above the range high at 300$ intervals (I already have a long trade running). In this eventuality, I will decide on the spot, if and when to place a short trade.
• Long Invalidation: below 28.5K
• Short invalidation: above 32. K
Research:
January 2023:
Slightly Better than Expectations
Conclusions:
1. If the results are better than expected, we can expect price to increase.
2. Be careful of stop hunts. Wait for the stop hunt before you place a long trade.
3. Take profit if price moves sharply up.
4. Dump & Pump.
February 2023:
Slightly worse than Expectations.
1. If the overall inflation trend is down, expect a positive effect on price.
2. Don’t be too impressed by the immediate reaction to the announcement.
3. If you caught a big move, take profit.
4. Dump & Pump.
March 2023:
Slightly better than expectations.
1. If you caught a big move, take profit!
2. If price breaks above the resistance by a wide margin, consider a short trade.
3. Pump & Dump.
April 2023:
Generally, Inflation numbers were better than expected. However, Core CPI was slightly worse than expectations.
1. Core CPI has a more noticeable effect on PA.
2. If price moves your way, long or short, take profit.
3. NY dumps, Asia pumps.
4. Pump & Dump
May 2023:
Overall, the results were in line with expectations.
1. TP! TP! TP! TAKE PROFIT!
2. Pump and dump.
3. When the results are in line with expectations, volatility increases (this is just a notion, at this stage, but keep it in the back of your head.
4. Sell the range high, buy the range low.
June 2023:
Inflation numbers were better than expected (including Core CPI).
1. TP.
2. Sometimes the best strategy is to sit on your hands. This session was for advanced traders.
3. Wait at the edges of the range for opportunities.
NFA.
what do you think? Please share in the comments.
Best Wishes.
