The market pros love news: it helps move the market often at the expense of those that try to jump on the moving train on to see the pros switch direction as they dump into the late arrivals, either buyers or sellers. The sell side seems better, as covering fuels the market move.
Everyone has seen it. Market begins to move before news. "someone knows!" so average Joe jumps. The news comes out, and the market moves in an opposite direct! What happened? You were just played the "pump and dump" or the "sell and bail". Look at bad news that sent your long into defeat. If it is really "good" news (for the pros), it will resurface. Examples are any Euro Zone country that had a debt issue. Greece this/that market sells. It seems to disappear only to be "an issue" again when convenient for the pros. It never went anywhere; just on the back burner until needed.
The next news type is the standard information that comes out regarding consumer sentiment, unemployment, prices, etc. A good economic calendar can give you these dates, types, and a personal value as to the importance of each release. Earnings are important and can be an individual stock mover, and market if the stock is an important element of the market value calculation.
The last category is Government Speak, and this is the market wildcard. An official can say the wrong think at the right time (or right thing-wrong time) and send the market in a frenzy. Government Speak is unpredictable. yes Treasury-FED types try to temper what they say, but even that is not a given.
News is, well news. Sometimes less is more, and more is less.
WEDNESDAY 11/28/12
The news effect is evident. Selling was in command until a Government Speak gave a strong endorsement to a financial cliff solution.
THURSDAY 11/29/12Range bound because the Government Speak was not what it seemed; it was reality that moved the market. PA found it difficult to break the LB and the SB and range runs ruled the day.
The sell bias continued in the after hours with another range run, 5 point sell off.
No comments:
Post a Comment