Debriefing of yesterday's FOMC IWM/TZA discretionary trade

[Billy]

Hi Billy,

To summarize, you are using the more conservative of (VWAP, Volatility stop) as your initial entry stop, right?

Wei,

Yes, but it is almost always VWAP that will be the most conservative initially.
I present here a successful trade (with big reward) but maybe 60% of them are stopped out at VWAP with microscopic losses. If you do such trades outside of a news event reaction, the failure rate will increase dramatically maybe over 80%. That's why I always wait for a programmed news reaction, where price usually waits near VWAP and I play the first successful pullback above VWAP if long, or the first failed bounce below VWAP if short. I prefer to see cumulative TICK trend confirmation before taking the trade.
Billy
Billy