How Does the Nasdaq 100 Trade On FOMC?

📈 How Does the Nasdaq 100 Trade on FOMC Days?

2024 has been a standout year, posting the largest annual gain on FOMC Days—by a factor of two—compared to the next most profitable year since 2016.

📊 The Test:

We tested a simple strategy:

✅ Go long Nasdaq 100 futures at midnight on FOMC Day

✅ Exit at the close 4:55 pm EST.

Since 2020, this pattern has become increasingly profitable, as markets have perceived Federal Reserve policy statements as bullish, particularly post-pandemic, with 2024 being the most profitable.

🔍 Key Observations:

2024 Bull Market's Unique Feature: Net gains are occurring during the least liquid trading periods.

Specific windows contributing to gains:

Evening sessions (4:00 PM to 9:30 AM EST)

Holidays, election weeks, and FOMC Days—times traditionally viewed as choppy and illiquid.

At the end of November, data revealed that more than 100% of 2024's net gains came from the evening session alone.

🚨 The Big Question:

How solid is a bull market that establishes the majority of its gains during low-liquidity periods?

The 2024 bull market is rewriting the rulebook on where and when market gains occur. Is this a sign of resilience—or vulnerability?

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