Which News Announcements Move the Markets?

Discussion in 'Trading' started by Sam Mcgee, Oct 28, 2003.

  1. easymon1

    easymon1

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    #21     Mar 12, 2023
  2. easymon1

    easymon1

    News-2023 0308 HG 5m 0535.png
     
    #22     Mar 12, 2023
  3. easymon1

    easymon1

    EOD-2023 0314 mes 1m.png
     
    #23     Mar 14, 2023
  4. On certain tools like Bloomberg or Refinitiv eikon, they'll typically have an indicator signifying how important an indicator is. However, while that's helpful from a basic filter (there are hundreds of thousands of indicators and you want to just see the top x%) it's not super helpful from a strategy standpoint. I was taught to do a mental check with each bit of data.

    On the macro side it would look like this:
    - Does this information change my view of economic activity (unit basis)
    - Does this change my view of price levels
    - Does this change my view of monetary policy

    If the indicator does not fit into one of those buckets, it's useless and just move on. However, if it does fit, then you should expect that the market will price in a revision to the pre-release view.

    For example, if consensus for Q1 GDP was 2% and then we get a hot PMI print (actual comes in at 60 vs 50 estimated, in this example), you would expect Q1 GDP estimates to shift higher...
    ... the implications of that shift has down stream effects across asset class (stocks, bonds, fx, commodities) depending on what those assets were pricing prior.

    When you think about indicators from this standpoint, you come to the conclusion that surprises to data are what actually moves the market (and there are indexes that track economic surprises -- Citibank runs some, for example).
     
    #24     Mar 16, 2023
    YuriWerewolf likes this.