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WEEK THREE:
STUDY SESSION #5
TRADING SET UPS &
HOW TO CHOOSE THE BEST TRADES
News events whether economic or otherwise do move markets. It is
news that in most, cases causes new information to come into the
markets and cause the prices to change.
The activity of traders trading may also make the markets move. This
activity causes other traders to trade. This is called momentum trading.
Even when prices get to certain technical areas, this activity causes
more traders to trade which moves the market. So, news is not the only
factor that moves the markets.
It is not what is being said in the news as much as the fact something is
being said to make traders react. We really do not know how the
markets will react to news. For example, when earnings are good, one
expects a stock to rally. But that does not always happen.
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