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After the blackout period ends

Before major central bank meetings, officials observe a blackout period, typically a week or more, in which they don't comment publicly on monetary policy. Markets get quiet and wait.

When the blackout ends, speeches resume, and so do headlines. The first remarks after the meeting carry weight, as officials explain the decision and hint at the future.

The market's reaction to those speeches can be larger than the reaction to the meeting itself, especially if the tone differs from the official statement.

A cluster of speeches in the days after a meeting produces repeated volatility, at scheduled but often less-watched times. A single sentence from a regional governor can move a currency 30 pips.

The speech calendar is published by central banks. Many retail calendars list it, but with low impact labels, which understate the potential.

Another point is the quiet before. During the blackout, markets lack catalysts and ranges compress. Mean reversion tends to work better, and breakouts fail more often.

Treating the blackout as a distinct phase, and the post-meeting period as an active one, matches the rhythm of the information flow.

For a scalper, it helps to keep a short list of central bank officials who have moved markets before, along with the typical timing of their appearances. Some speak at scheduled conferences, some give interviews on news channels, some appear in committee hearings. The language they use, especially phrases that depart from the prior statement, matters more than the headline.

A quiet mid-week speech can create a larger move than a formal meeting if it signals a change in tone. Setting alerts for the names on the list, and checking the calendar each morning, takes a few minutes and avoids the surprise.

Blackout weeks versus the weeks after meetings: does the strategy behave differently?

Central banks have blackout periods before policy meetings, when officials don't give speeches about policy. For the Fed, the blackout starts the second Saturday before the meeting and ends at midnight the day after. Once it ends, officials often speak, and their comments can move markets as they explain their views. The Fed's schedule of meetings and blackout dates is published on its website, which makes it easy to plan around them. Other central banks, like the ECB and the Bank of England, have similar quiet periods before their meetings.

My strategy does behave differently, and I only found that out after I split my last two years of trades by week type. In the quiet weeks before a meeting, my fade setups on EURUSD made money at a noticeably higher rate, and my breakout setups were weak. In the week after a meeting, the picture flipped, with breakouts doing much better but the stop-outs being larger because of the sudden jumps.

The practical rule I took from this is to change the trade type, not just the size. Before a meeting I trade only reversions from the edge of the day's range, and I keep the target small. After the meeting, I wait for the first retracement after a speech instead of chasing the headline, because the first spike often travels about half of the day's eventual move and then pulls back.

The other detail is time zones. Some of the regional speakers appear during the Asian morning, when liquidity is thinner, and a small comment can look much bigger on a chart than it would later in the day.