GM stock target $0 !!!
Circuit Cty filing for chapter 11 protection !!!
DHL to cut 9500 jobs!!!
etc etc.
What does it show? Confused? Well, in fact, it is not surprising at all. This is precisely why it is advised to ignore news and follow charts, which incoroparate news in advance barring few unforeseen things. This is also known as "factoring in" of news into price.
I have always maintained and advised here to follow technicals when trading and forget news, the simple reason is - we can't be fast enough to always have breaking news at our steps and we can't be good enough to judge what a news can do to price. Many times the expectation of an event is almost accepted and so it already reflects in the price.
Traders, daytraders in particular, can't ignore news, Harry :-)
ReplyDeleteBest we can do is to sit back and wait for the dust to settle.
I disagree Jules,
ReplyDeleteI myself NEVER even look at news when I trade. I don't even keep a TV set near my trading room. And since I started trading TOTALLY WITHOUT NEWS, I didn't need to "ignore" it :) We don't need to ignore what we don't see :-)
I am not alone in practising this "ignorance". In fact, I know so many people who are trading for decades without news. Once you control your urge to look at events, you win.
Try it once, just believe charts, and you'll find it the most exciting thing u ever had...
P.S. to my last comment: Trading by charts means trading with discipline, NO TRADE without prior calculation of potential loss and STRICT STOP LOSS are the keys...
ReplyDeleteOk, Harry, I'm getting really sick of CNBC anyway.
ReplyDelete:-)
Hahaha Jules,
ReplyDeleteWel, CNBC (US) do have one good program at least - MAD MONEY (Stop Trading with Jim). Not for its quality, but for its adherence and compatibility with the title (MAD) :-)
I always mute my tv during that part. I HAVE TO. He gives me bad headaches. Serious.
ReplyDeleteThe post is very interesting as well as the comments. I always learn a lot.
ReplyDeleteThanks Mish, thanks a ton :)
ReplyDelete