July 31st, 2024

Fed Day and the End of the Month. My goal with my morning note is to discuss the market environment and give traders an edge in understanding the conditions so they can execute their strategies better during the day. On a day like today, I do not have an edge. It’s not just because of the Fed and End of the Month. It’s also an environment where we’re in a two-way tape, the technicals are cloudy, and this market can ping-pong in a wide range without changing the look of the overall technicals. That is a hard environment to manage risk in.

How do day traders approach a day like today? When to trade big, small, or not at all… Today is small or not at all. Put a number on your risk, wait for a clean setup, and take the win or the loss and move on with your day. Do not try to fight a tape that you will not beat.

We must remember that just because we know a market will be busy, it doesn’t mean we will make money.

The last 15 minutes today could see a massive move in one direction for the end of the month. I will not be trading it; I will be watching and learning about what the next move may be in the coming sessions. Keep it light and tight.

Cheers, DELI