Discussion in 'Trading' started by apaschea, Feb 15, 2011.
.... we had a red day and now futures are up by 30 points on dow?...anything i'm missing
Buddy, it will take 10 years of effort where you will observe, learn, revise and absorb the market movements.
10 years of effort and practice.
That much time it takes to convert a student to a professional doctor or an engineer.
Because you got to buy the dip..
More often than not...it's key market events that move the markets and that includes news.
Simply, you need to use a news source to answer questions like this when you see something like this in the price action.
* Obviously something happen in the after hours. Thus, any free decent news source would have mention Dell triple net income.
There were other smaller news but Dell was the big story.
Dude come on, there isn't that much correlation between most forms of news and index movements. Futures are up because the trend is up and everybody is buying. Some news on Dell is maybe going to add a little spice to the move but if there had been no news they would have moved up just the same.
Also Asia is in the green and maybe the traders there are not so pessimistic on the bubbly schmubbly anymore in China.
Slow down there cowboy...I didn't say anything about any correlation as in directional nor did I say anything about trend analysis.
Short term price movement for a specific duration in time as the OP described are (more often than not) via key market events. Key market events moving price has been a fact since the markets have been born. I don't care what direction...it just moves. Too many millions of examples of what happens when news is release that has a direct short term impact on the price react (e.g. FOMC announcement) regardless to the direction.
The thread started asked about a "specific price reaction". He got his answer and if you want to talk about something else...such as trend analysis (the trend is up or down) or market correlation...that's on you.
By the way, today is the 1030am est EIA Petroleum Status Report...I'll post a follow up chart later today showing how a key market event does have impact on the price action of a futures market such as Light Crude Oil CL futures. Further, accordingly via an analogy to your commentary, today's Oil price reaction to the 1030am est report would have happen anyways had the report not been release...direction not important considering we're just interested to see if a news event can move prices
I guess via you logic...the way the market reacted to 911 would have happen anyways had there not been a 911. What are you smoking by the way.
Yeah, the market is up and thanks for the partial agreement that Dell did have something to do with the initial price reaction.
thats why I wade through the detritus here on ET, for the occasional pearl of wizdome like wrbtrader's missive,
PS. That's 2 words you don't know.
Here's the follow up chart I promised in my prior message as an example of why we as traders need to be aware of key market events because they do have a direct impact on price reaction. Simply, if you want to know when markets are most likely to produce a swing point, reaction point or volatility spike into trend continuation...keep track of the times of these key market events.
By the way, they often serve as profit targets too. Thus, keep track of those recent key market events because they do represent key changes in supply/demand. For example, if your trade method (whatever that may be) had gotten you Long as a reaction to the key market event around 1120am est...you could have used the price area that was a key change in supply/demand around 1030am est as a via the EIA Petroleum Status Report as a profit target.
Simply, tough case to prove that the price would have reacted like that "at that particular time" without the key market event.
1st Annotation - Price reaction to 1030am est EIA Petroleum Status Report
2nd Annotation - Your homework is to find out what key market event caused the price reaction between 1020am - 1024am est
3rd Annotation - If Long in the price reaction highlighted in the 2nd annotation...use the key change in supply/demand represented in the 1st annotation as a profit target
Class over for today.
Light Crude Oil CL Futures
Separate names with a comma.