The Bank of England announces its rate decisions at 12:00 London time. On those days I change my routine for sterling pairs.
My approach:
Normal trading in the morning until about 11:00, with smaller size from 10:30 because ranges often narrow.
Flat in all GBP pairs from 11:45. No pending orders either.
I don't trade the first 5 minutes after the release. GBPUSD can move 50 pips and spreads are wide.
After that, I look at the vote split and the statement. A different vote split than expected often moves sterling more than the decision itself.
Around 12:15 I sometimes take one trade if a clear direction holds above or below the first spike range, with a stop beyond the spike. Most decision days I take zero GBP trades in the afternoon.
The press conference at 12:30 can reverse everything, which is another reason I keep size small.
How do others handle BoE days? Do you trade the reaction or stay out completely?
My routine on BoE days is very close to yours, mostly because I got burned trying to be clever around the release. I once left a pending buy stop on GBPUSD about fifteen pips above price, thinking I'd catch a move. It filled on the spike with heavy slippage and reversed within a minute.
These days I stop trading sterling entirely about half an hour before, and I don't come back until after the press conference has started. The vote split is the part I pay most attention to. A couple of times the decision was exactly as expected but one extra dissenting vote moved the pound more than the rate itself.
If I trade at all in the afternoon it is usually EURGBP rather than cable, once the range settles, because it tends to calm down quicker. Most of the time though I take the day as a rest from sterling and focus on other pairs instead.
