The Federal Reserve is the most important central bank in the world because of the special role the US dollar plays as a reserve currency. Therefore, it is important to you as a trader to always pay close attention to FOMC meetings and activities.
Table of Contents
ToggleFirst, What is FOMC?
The Federal Open Market Committee (FOMC) is one of the most important items in the economic calendar. It is a special committee of the Fed chaired by the Fed Governor, whose role is to analyze the economy and conduct the necessary monetary policy.
These analyses and conductions are done during the FOMC meetings, which are scheduled – and often impromptu. The scheduled meetings are held every month without a specific frequency.
The FOMC decision is among the most important events in the economic calendar. Important because of how it influences the market in the long run.
Why Is the FOMC Meeting Important to You as a Trader?
The major reason the FOMC meeting is usually considered the most important date on any traders’ calendar is because of INTEREST RATES. Thanks to its policy tools, the FOMC can raise or lower the federal funds rate in the US.
This change in rate will trickle down to other interest rates, including FX rates and bond prices, which can have a big impact on traders. In other words, if the FOMC chooses to raise or lower interest rates, the effects will reverberate across global financial markets.
Major markets that experience this hit are:
- Forex trading
- Indices trading.
- Bonds trading, and
- Gold trading.
Inarguably, the US economy is the largest in the world. Therefore, repercussions from the FOMC decision could be felt worldwide. And this is why you, as a trader, have to pay attention to the FOMC decision. It is a major indicator of global economic trends.
Likewise, you can also receive insight from the FOMC decisions into how worldwide central banks may adjust inflation policies.
What Happens at FOMC Meetings?
FOMC Meetings are hosted primarily to discuss interest rates and other financial concerns. Two major purposes of the meeting are to determine what intervention steps are necessary and to review the existing economic data.
Each FOMC meeting has five Federal Reserve Bank presidents and seven governors of the board sit and discuss the monetary policy for the United States and decide what to do. Though the meeting is private, key decisions get announced at a special press conference once everything is finalized and finished.
The minutes of these meetings get released three weeks after they’re held. Typically, these reports record the main decisions of the meeting and explain the reasoning behind them.
If you prefer long-term trading patterns, be aware that the FOMC decision could take time to impact the economy fully.
What Tools Does the FOMC Use to Influence the Financial Markets?
Of course, as mentioned earlier in this article, the FOMC are strongholds that can influence the market. But the big question is, How Do They Do It?
Here are the tools the FOMC uses to influence the markets:
- Federal Funds Rate
- Quantitative Easing
- Reserve Repurchase Agreements
- Primary Credit Rate
- Reserve Requirements
- YCC (Yield Curve Control)
Top Tips for Trading the FOMC Meetings
Here are expert-proven tips you should consider when trading around FOMC meetings:
1. Know the Meeting Date
You can know this on the Federal Reserve website. Apart from the announcement of the press conference and policy statement, check out the date and time when the meeting minutes will be released.
2. Have a Strategy Before the Announcement
Your strategy should detail how you will react to the outcome of the FOMC meeting. What are your market expectations? How do you think the market will react to whatever announcement the FOMC makes?
You can create your strategy based on analysis and opinions from commentators, alongside the comments from previous recent FOMC meetings.
3. Have a Risk Management Plan
Risk management applies everywhere. You can’t forget about the risk management basics when trading during an FOMC meeting. Use take-profit and stop-loss orders, and make sure you don’t put more than you can afford to lose on a single trade.
4. Think Long-Term
You don’t necessarily have to trade based on the announcement on the day it’s made. Most of the FOMC decisions take time before influencing the markets and economy. Continue with your long-term strategy, and don’t rush things because other traders are. Remember, your strategy is not their strategy.
This Post Has 70 Comments
I don’t think the title of your article matches the content lol. Just kidding, mainly because I had some doubts after reading the article.
Hey very cool website!! Man .. Excellent .. Amazing .. I will bookmark your website and take the feeds also…I am happy to find a lot of useful info here in the post, we need work out more strategies in this regard, thanks for sharing. . . . . .
I loved as much as you will receive carried out right here. The sketch is tasteful, your authored subject matter stylish. nonetheless, you command get got an impatience over that you wish be delivering the following. unwell unquestionably come more formerly again as exactly the same nearly very often inside case you shield this increase.
This is a very good tips especially to those new to blogosphere, brief and accurate information… Thanks for sharing this one. A must read article.
hey there and thank you for your info – I’ve definitely picked up something new from right here. I did however expertise some technical issues using this site, since I experienced to reload the site lots of times previous to I could get it to load properly. I had been wondering if your hosting is OK? Not that I’m complaining, but slow loading instances times will very frequently affect your placement in google and could damage your high-quality score if advertising and marketing with Adwords. Anyway I’m adding this RSS to my email and can look out for much more of your respective exciting content. Make sure you update this again soon..
Do you mind if I quote a few of your articles as long as I provide credit and sources back to your site? My blog is in the exact same niche as yours and my users would certainly benefit from a lot of the information you present here. Please let me know if this okay with you. Appreciate it!
I do not even understand how I ended up right here, but I assumed this submit was great. I do not recognise who you’re however certainly you’re going to a well-known blogger for those who are not already 😉 Cheers!
I love it when people come together and share opinions, great blog, keep it up.
I like what you guys are up too. Such clever work and reporting! Carry on the superb works guys I have incorporated you guys to my blogroll. I think it’ll improve the value of my web site 🙂
I like this weblog so much, bookmarked. “I don’t care what is written about me so long as it isn’t true.” by Dorothy Parker.
Hola! I’ve been reading your site for some time now and finally got the courage to go ahead and give you a shout out from Porter Tx! Just wanted to mention keep up the excellent work!
magnificent put up, very informative. I ponder why the other specialists of this sector do not realize this. You should proceed your writing. I am sure, you’ve a huge readers’ base already!
Hi! Someone in my Myspace group shared this website with us so I came to look it over. I’m definitely enjoying the information. I’m bookmarking and will be tweeting this to my followers! Terrific blog and superb style and design.
obviously like your web site but you need to check the spelling on several of your posts. Several of them are rife with spelling problems and I find it very troublesome to tell the truth nevertheless I will surely come back again.
F*ckin’ awesome things here. I’m very glad to see your post. Thanks a lot and i am looking forward to contact you. Will you kindly drop me a e-mail?
Very interesting information!Perfect just what I was looking for! “Better and ugly face than an ugly mind.” by James.
I was suggested this blog by way of my cousin. I am not certain whether this publish is written by means of him as no one else realize such distinct about my trouble. You’re amazing! Thank you!
child porn
Keep up the fantastic piece of work, I read few blog posts on this web site and I believe that your blog is rattling interesting and has got bands of fantastic info .
I genuinely enjoy reading through on this internet site, it holds great content. “Never fight an inanimate object.” by P. J. O’Rourke.
Thanks for your personal marvelous posting! I quite enjoyed reading it, you will be a great author.I will remember to bookmark your blog and will often come back later in life. I want to encourage continue your great job, have a nice day!
hello there and thank you for your information – I’ve certainly picked up anything new from right here. I did however expertise several technical issues using this web site, as I experienced to reload the site lots of times previous to I could get it to load correctly. I had been wondering if your hosting is OK? Not that I’m complaining, but sluggish loading instances times will often affect your placement in google and can damage your high-quality score if advertising and marketing with Adwords. Anyway I’m adding this RSS to my e-mail and can look out for much more of your respective fascinating content. Make sure you update this again soon..
Wonderful goods from you, man. I’ve be aware your stuff previous to and you are simply extremely excellent. I actually like what you’ve obtained here, certainly like what you’re stating and the way in which through which you are saying it. You make it entertaining and you still take care of to stay it smart. I can not wait to learn far more from you. This is actually a great site.
wonderful post, very informative. I wonder why the opposite experts of this sector do not understand this. You should continue your writing. I am sure, you’ve a huge readers’ base already!
We are a group of volunteers and opening a new scheme in our community. Your site provided us with valuable information to work on. You’ve done an impressive job and our whole community will be thankful to you.
Hiya, I’m really glad I’ve found this info. Today bloggers publish just about gossips and web and this is actually frustrating. A good blog with exciting content, that’s what I need. Thanks for keeping this site, I will be visiting it. Do you do newsletters? Cant find it.
What Is FitSpresso? The effective weight management formula FitSpresso is designed to inherently support weight loss. It is made using a synergistic blend of ingredients chosen especially for their metabolism-boosting and fat-burning features.
I was curious if you ever considered changing the page layout of your site? Its very well written; I love what youve got to say. But maybe you could a little more in the way of content so people could connect with it better. Youve got an awful lot of text for only having one or two images. Maybe you could space it out better?
I’ve been absent for some time, but now I remember why I used to love this blog. Thanks, I will try and check back more frequently. How frequently you update your web site?
Simply wanna comment that you have a very nice site, I enjoy the pattern it actually stands out.
Good day I am so happy I found your web site, I really found you by accident, while I was researching on Google for something else, Regardless I am here now and would just like to say thanks a lot for a marvelous post and a all round interesting blog (I also love the theme/design), I don’t have time to go through it all at the moment but I have saved it and also included your RSS feeds, so when I have time I will be back to read a great deal more, Please do keep up the fantastic work.
I¦ve read a few just right stuff here. Definitely worth bookmarking for revisiting. I surprise how a lot effort you put to make any such fantastic informative website.
Wonderful web site. Plenty of useful information here. I’m sending it to several friends ans also sharing in delicious. And certainly, thanks for your sweat!
Your home is valueble for me. Thanks!…
I have been exploring for a little for any high quality articles or blog posts on this sort of area . Exploring in Yahoo I eventually stumbled upon this web site. Studying this information So i am glad to show that I have an incredibly good uncanny feeling I came upon just what I needed. I most certainly will make certain to do not forget this website and give it a look regularly.
Hello there, just became aware of your blog through Google, and found that it’s truly informative. I am gonna watch out for brussels. I’ll appreciate if you continue this in future. Many people will be benefited from your writing. Cheers!
What is Zen Cortex? ZenCortex is not just another drop in the ocean of dietary supplements; it’s a formulated concoction designed with a clear aim: to enhance auditory health and cognitive functions.
There is noticeably a bundle to find out about this. I assume you made certain good points in features also.
Regards for helping out, good information. “Job dissatisfaction is the number one factor in whether you survive your first heart attack.” by Anthony Robbins.
It’s laborious to find knowledgeable individuals on this matter, but you sound like you realize what you’re speaking about! Thanks
I truly enjoy looking through on this website , it holds wonderful content. “Beauty in things exist in the mind which contemplates them.” by David Hume.
Great amazing things here. I am very happy to peer your post. Thank you a lot and i’m looking ahead to touch you. Will you please drop me a mail?
I genuinely enjoy looking at on this web site, it has superb content.
Wohh just what I was looking for, thanks for posting.
This is very interesting, You’re an overly professional blogger.
I’ve joined your rss feed and look ahead to in the hunt
for extra of your great post. Also, I’ve shared your website in my social networks
My blog post … nordvpn special coupon code 2024
Excellent beat ! I would like to apprentice at the same time as you amend your web site, how can i
subscribe for a blog web site? The account aided me a appropriate deal.
I have been tiny bit familiar of this your broadcast provided bright transparent concept
Also visit my web-site :: eharmony special coupon code 2024
I love your blog.. very nice colors & theme. Did you create this website yourself? Plz reply back as I’m looking to create my own blog and would like to know wheere u got this from. thanks
I have been exploring for a bit for any high quality articles or weblog posts in this kind of house . Exploring in Yahoo I ultimately stumbled upon this website. Studying this information So i’m glad to convey that I have an incredibly excellent uncanny feeling I came upon exactly what I needed. I such a lot for sure will make sure to don’t omit this web site and give it a glance on a continuing basis.
Tonic Greens: An Overview. Introducing Tonic Greens, an innovative immune support supplement
Good day! Do you use Twitter? I’d like to follow you if that would be ok.
I’m definitely enjoying your blog and look forward to new updates.
my web page: facebook vs eharmony
Thank you for the sensible critique. Me & my neighbor were just preparing to do a little research on this. We got a grab a book from our area library but I think I learned more from this post. I am very glad to see such magnificent info being shared freely out there.
When I originally commented I clicked the -Notify me when new comments are added- checkbox and now each time a comment is added I get four emails with the same comment. Is there any way you can remove me from that service? Thanks!
I conceive this site has got some rattling excellent information for everyone :D. “Years wrinkle the skin, but to give up enthusiasm wrinkles the soul.” by Samuel Ullman.
I really enjoy studying on this site, it contains wonderful posts.
Great – I should certainly pronounce, impressed with your site. I had no trouble navigating through all tabs and related information ended up being truly easy to do to access. I recently found what I hoped for before you know it in the least. Reasonably unusual. Is likely to appreciate it for those who add forums or something, web site theme . a tones way for your client to communicate. Nice task..
Very interesting details you have observed, thankyou for putting up. “Above all be true to yourself, and if you can not put your heart in it, take yourself out of it.” by Hardy D. Jackson.
I simply could not depart your site prior to suggesting that I extremely loved the usual info an individual provide in your guests? Is going to be back frequently in order to check out new posts.
I believe that is among the most important info for me. And i am satisfied studying your article. However wanna remark on few basic things, The website style is perfect, the articles is in point of fact excellent : D. Good job, cheers
Very interesting information!Perfect just what I was looking for!
Utterly written subject material, thanks for entropy. “Life is God’s novel. Let him write it.” by Isaac Bashevis Singer.
It¦s really a nice and useful piece of information. I¦m happy that you shared this helpful info with us. Please keep us informed like this. Thank you for sharing.
Oh my goodness! an incredible article dude. Thank you Nevertheless I am experiencing concern with ur rss . Don’t know why Unable to subscribe to it. Is there anyone getting identical rss downside? Anyone who knows kindly respond. Thnkx
Hey there! I know this is somewhat off topic but I was wondering if you knew where I could find
a captcha plugin for my comment form? I’m using the same blog platform as yours and I’m having difficulty finding one?
Thanks a lot!
my website; vpn 2024
I like your writing style truly enjoying this internet site.
You really make it appear so easy with your
presentation however I in finding this topic to be really something that I
think I would never understand. It kind of feels too complex and very
huge for me. I’m having a look forward to your subsequent put up, I’ll try to get
the dangle of it!
Feel free to surf to my homepage; vpn special coupon code 2024
Very interesting topic, appreciate it for posting. “The friendship that can cease has never been real.” by Saint Jerome.
Oh my goodness! a tremendous article dude. Thanks Nonetheless I am experiencing issue with ur rss . Don’t know why Unable to subscribe to it. Is there anyone getting similar rss problem? Anyone who knows kindly respond. Thnkx
Woh I enjoy your content, bookmarked! .
Wow, awesome weblog structure! How lengthy have
you been blogging for? you made blogging look easy.
The total look of your site is fantastic, as neatly as the content material!
You can see similar here dobry sklep
It’s laborious to search out knowledgeable people on this topic, however you sound like you recognize what you’re speaking about! Thanks