Friday CPI news

Trading notes for 2026-02-13

TL;DR

Traded the thesis that weekly candle wouldn't close at the lows without a wick, playing it into CPI news at 8:30am which initially pushed higher. However, market open at 9:30am brought a classic trap move, shaking out early longs before eventually grinding back to weekly VAL and resistance levels to close the week.

Market Context

The market was showing familiar patterns that aligned with my pattern matching framework. We were approaching the end of both the trading day and the weekly session, with price sitting at the lows. This created a key technical setup where the weekly candle was positioned to potentially close without any lower wick - a scenario I believed was unlikely based on historical price action patterns.

The timing coincided with the CPI news release at 8:30am, providing a potential catalyst for the move I was anticipating.

Thesis & Plan

My core thesis centered on weekly candle structure and market behavior patterns. Specifically, I believed the weekly candle wouldn't close at its absolute lows without forming some kind of lower wick. This pattern recognition suggested we'd see at least some upward movement before the weekly close.

The plan was to play this technical setup in conjunction with the 8:30am CPI news release, using the fundamental catalyst to potentially trigger the technical move I was expecting.

Entries & Exits

The initial part of the thesis played out as expected. At 8:30am, the CPI news release provided the catalyst that pushed the market higher, confirming the weekly candle structure idea.

However, 9:30am market open brought a different dynamic entirely. The market executed what it does best - trapping traders who had positioned long during the news session.

What Worked / What Didn't

What Worked:

• Pattern matching approach correctly identified the weekly candle setup
• Timing the thesis with CPI news release provided initial confirmation
• The overall directional bias proved correct as market eventually moved higher

What Didn't Work:

• Failed to anticipate the 9:30am trap move that shook out early longs
• Didn't account for the market's tendency to punish news-driven entries at the open
• The execution timing could have been better managed around the market open dynamics

Market Resolution

After the initial trap move at market open, the market slowly and grudgingly worked its way back higher. It eventually pushed back to the weekly Value Area Low (VAL) and into resistance levels before closing out the week. This validated the original thesis about weekly candle structure, though the path there was more volatile than initially anticipated.

Lessons Learned

Pattern Recognition vs. Execution Timing: While the pattern matching correctly identified the weekly setup, the execution around news and market open could have been more refined. The market's behavior of trapping early news traders is a consistent pattern that should be factored into entry timing.

Market Open Dynamics: The 9:30am open remains a critical inflection point where initial moves often get reversed. Even when the overall thesis is correct, being aware of these intraday reversal patterns is essential for better entry and exit timing.

News + Technical Confluence: The combination of technical setups (weekly candle structure) with fundamental catalysts (CPI release) can be powerful, but requires careful consideration of how retail traders typically react to news and how market makers respond to that flow.

Patience in Execution: The market ultimately reached the anticipated levels (weekly VAL and resistance), but did so "slowly and begrudgingly." This reinforces the importance of giving trades time to develop rather than expecting immediate gratification, especially on weekly timeframe setups.

The session served as a good reminder that while pattern recognition and thesis development can be solid, the market's path to reaching those levels often includes traps and false moves designed to shake out weak hands before the larger move materializes.