There are 32 days in the year that matter to most traders.
These are special days when it’s possible to get outsized returns on your money. That’s why I call these days “money shocks.”
And they exist even in bear markets.
In fact, I first noticed this pattern during extreme conditions… right as the 2008 great financial crisis was playing out.
Many of us remember how it went…
The housing bubble collapsed, and the financial sector was left holding the bag. That led to the collapse of Bear Stearns and Lehman Brothers… along with more than 500 other banks. The government stepped in to prop up Fannie Mae and Freddie Mac and “bail out” the big banks.
Put simply, it was a mess… And over 16 months, the markets fell roughly 50%.
But if you knew where to look, there were certain days when savvy traders could make serious money.
I was still working at my hedge fund, Banyan Capital, during that period. On one of these days, my firm made $4.2 million net profit. On another, we generated $6.1 million. On a third occasion, it was over $8 million.
Of course, we achieved these returns with more money than the average trader has.
But there’s nothing stopping regular folks – with modest portfolios – from taking advantage of these opportunities too.
In fact, my subscribers have made over 89 winning trades on these “money shock” days… just since January 2022.
And today, I’m going to explain how…
Sensitive Data
Most people tune out things like government data and statistics. And it’s easy to see why…
Unless you need to know a particular statistic, few of us have reason to dig into the often clunky websites where this boring and technical data is kept.
But for traders, it would be a huge mistake to ignore certain key numbers.
In fact, the 32 days I mentioned earlier refer to times when the government releases valuable pieces of information… like inflation data or interest rate changes.
And these reports can send market action up by as much as 20X.
That’s because increased volume and volatility equals greater potential to make more money quickly.
During these “shocks,” the federal government makes it even easier to generate incredible returns…
This is where I thrive.
In these kinds of moments, everyone thinks they have a genius prediction for where they expect the economy to go. So more people place their bets – often with undue risk – and send prices flying up and down.
Now, a lot of those same people lose money.
But when you know how to play it, you can make solid wins. We had an example just this month…
Playing the FOMC Announcement
On January 27, we entered a trade leading into a “money shock” event…
The upcoming Federal Open Market Committee (FOMC) announcement was just days away and the market was waiting on tenterhooks to see how much the Fed was going to raise rates. So, we made a bet on the iShares 20 Plus Year Treasury Bond ETF (TLT).
Bond yields were struggling to rise and had rejected the 3.7% level five times in a month. But we saw the potential for a continued short-term TLT rally.
And we knew that the Fed would only raise rates by 25 basis points (bps)… less than what many were anticipating.
We were expecting another leg down in Treasuries to set us up for a great profit-taking opportunity… and that’s exactly what happened.
Rising Fed rates generally lift Treasury rates – unless they’re already priced in or the Fed raises less than expected. So for TLT to rally, we wanted to see the Fed’s interest rates come in lower than expected.
(When an existing bond has a lower coupon than current rates, investors may find it less appealing – and thus its market price typically drops.)
At the time, many still feared that the Fed would raise rates by another 50 bps. But since it increased by just 25 bps, that “lower” rate sent our TLT position well into the green.
We sold on February 1 right after the Fed’s announcement for a quick 30% gain.
But ultimately, it didn’t really matter whether the Fed raised rates by a little or a lot… The announcement alone was the important thing.
Because these kinds of events give the markets an electric shock… and stir up volatility that traders like us are more than happy to use.
And while a 30% gain might not sound like much, trades like these can quickly “snowball” your account. Not to mention, we reached that gain in less than a week.
That’s the power of these “money shock” days.
Pay Attention to “Money Shocks”
I’ve been trading these events ever since 2008 and experienced their potential firsthand.
These “money shocks” are a big tool for the traders who know when and how to use them.
And in a topsy-turvy environment like we’re in now, we all need that extra edge to make the most of our capital.
That’s why this month, I want to show you how to “up” your game and do the same.
We’re less than a week away from the big release of my “Money Shock Calendar.” On February 22 at 8 p.m. ET, I’m revealing how you can outpace anyone who ignores these 32 dates.
To attend, simply sign up with one click right here.
Regards,
Larry Benedict
Editor, Trading With Larry Benedict