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One Cancels The Other (OCO) Orders


I love swing trading, pivot or otherwise, but I'm also a scalp and momentum opportunist, and I'll gladly wear the title non-trader given by detractors of this strategy as a result.

There are no other statistically favorable directional momentum movements aside from mean pivot gravitation or overnight or cash gap closing than there exists from the FOMC (Federal Open Market Committee) Announcement (not the Minutes from - thanks, Rich) and the Non-Farm Payroll. All other news or announcements are considered deviations in degrees of volatility from the two.

On the days of those announcements, after a preset ATM order strategy is in place, at a minute before the report, I'll place an OCO on the board to be scaled in a few ticks below the lowest bid, all the while managing my entry and watching price action for a clue of where insiders have the mind to take it. At 5 seconds before, I'll move each order, long and short, to the best bid. Before I know it, I'm filled either long or short and once so the other order not filled is cancelled. I haven't caught a falling knife or been toppled by an ocean plate wave and I'm out no less than one roundtrip commission. In short: I'm happy.

I use a scaleout strategy of two contracts at an initial two point stop loss and a trailing stop of 1 point initiated after a 4 point target, at which point if filled is set to break even, then I'm in for a 10 point target. Life's then good at 2 contracts for the whole pot. If by the slim chance the movement loses momentum before 4 points I'm all out at price on a limit order bare.

After order execution I rid the strategy on my Dom to none and like a hungry vulture I'm over price bare with my cursor in case other news reverses the direction just a quickly. The trailing stop is merely a hard stop in case my charts freeze on wicked high volume or a four point bar moves quicker than my eye and reflexes.

Treat yourself, try it out Wednesday on the FOMC Announcement. It's at 2:15 PM EST, just about the time people are considering covering for the day, so it could it turn out to be a trade of 10 points or more. I'd hate to see any of you miss the opportunity, or worse, get burned on it.

Let me know how it goes if you try it.

I almost forgot (heh): On Ninja, right click on the Dom and select OCO before you select your breakout strategy, and after the trade, or even before execution, but after board placement, deselct the OCO. It will prove cumbersome later if you forget. And often the rush after an OCO trade makes conditions favorable you'll forget altogether, so, you decide.

Good luck!
Thats great, but if @ 2:15pm the bar is a 15min. small doji one might consider a buy stop just above and a short just below. I only mention this as for me that's a little less brain work. The question still remains how far will it go either way and will it go up trigger the order then drag the market back down or vise-vsera,and who's to say it's going to be a doji anway. This is just something I keep in the back of my mind...Thanks for your insight SPQR I read everything and consider all that you traders say.
Sorry for the spelling. I needed another cup of coffee.
quote:
Originally posted by redsixspeed

Sorry for the spelling. I needed another cup of coffee.



I'm hardly one to favor the grammar Nazi. Were I an editor I'd starve to death.
And I'll second the cheering on of team java.

You bring up an intesting point in your first reply. @ 2:15 volume is dramtically lower seeing that moves are beginning to be more unpredicatble. Who's going to cover what and from where?, sort of thing. And I too dread and suffer the 15 minute doji passed 2:00. I'll admit this strategy is a touch more agreesive than many would prefer, but as I mentioned, from purely an extended period of observation, these two announcements/reports offer strong, and sustained, directional gravitation from the word go. The seasoned will either agree or disagree with subtle changes in FED policy and strength in numbers by the unseasoned are quickly overshadowed on raw volume.

I'm not saying take it, but if you'ld like begin to observe the pattern. It's just a another tool in the box is all.

I'll retort, though, by saying if one does what you mentioned, if using an OCO as well, the same concern could just as easily happen, but at more risk, if used with an OCO -- and risk that penetrates a margin to equity ratio.

Six to one and 1/2 a dozen to the other. (insert geek icon here)

I hope you're enjoying your weekend.

Cheers;
Look at my typos, man. haha

I swear that wasn't planned. I had too much coffee. lol
In order to reduce risk I would consider a 1st triggers oco. So then if I set my first order to buy and it triggers I now have the oco to the upside and downside, if we have the doji I must trust we are going up if my first order is a buy; then my oco would be sell limit @ the strongest resistance sell stop under my entry price. If my first order doesn't trigger then no harm no foul. Thanks for talking with me SPQR.