key driver of the markets
Paying special attention to ECB speakers – both scheduled and unscheduled .
Last week witnessed Jean Claude Trichet’s press conference which turned out to be the key market driver as he commented upon Eurozone inflation increasing from 1.9% to 2.2% and the ECB’s bond buying programme.
Trichet’s hawkish tone, highlighted by his use of the key phrase “monitor closely” when referring to the current level of inflation in Europe, caused a general sell-off in core European bond markets .
It is your responsibility as a Trader to research which ECB members are hawkish/dovish in order to provide you with an advantage upon the release of any relevant comments.
Traders should pay close attention to price patterns upon the releases these patterns often repeat in the markets on the back of subsequent comments .The markets’ reaction will also give you an indication of overall market sentiment. Such trade ideas do not always work out but it is your Job to be quick to spot them and be fearless in your execution of them.
As Previously Stated in the “open – rejection – reversal piece ” on News Fades – When reacting to news Often the market will move in a contrarian direction until such time as the herd begins to dismiss the validity of the original data and begins to reverse both their opinion and trades – A profitable trade historically for traders has been to fade aggressively the release of News
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