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Home > Investor's Education > Market Watching

Results 2 - 4  
Latest posts
DAILY MARKET BEHAVIOR
  Daily Market Behavior

09:30 Market Opens
09:45 Reversal Period
10:15 True Market Color
10:45 Market "Noise"
12:30 Low Activity
13:15 Market Returns
14:30 Break Out Period
15:00 Treasury Bonds Stop Trading - Market will Trend
15:15 Day Traders close out positions
15:30 Possible Minor Reversal
15:50 Another Possible Reversal
16:00 Market Closes
  Post added on July 26,2007
NEWS WATCHING
  NEWS WATCHING

Earnings Sympathy
“Moving in sympathy” is a term used to describe how other stocks within a similar industry will move in tandem with a stock that is riding on major euphoria or panic. The most common occurrence of this phenomenon is after an earnings announcement.

Interest Rates
The rise and fall of interest rates will cause stocks to move one way or the other. However, in recent times, the market has taken on a habit of “pricing-in” any possible adverse reactions to such announcements. In other words, if the market anticipates a tank after the announcement, it tends to push up prices about a week before the actual announcement. Thus, any fall out thereafter, will bring prices down to an acceptable level or at the level before the pricing-in exercise.

On the actual day of announcement, the market will then experience a knee jerk reaction to the news but will quickly recover to continue the current trend. A trend change will happen only when the announcement presents a totally unexpected surprise.

For more on Interest Rates, read up: FOMC Meeting Policy Announcement.

Treasury Bonds & the Yield Curve
Bonds are closely monitored by investors as an indicator of where Interest Rates may go. As Bonds rally, Yields fall. The two move in opposites. The commonly watch Treasury Bonds are the 2, 5 and 10 year notes and the 30 year bond.

Shorter term bonds normally yield less on the short term while longer term bonds yield more in the long term. When longer term bonds yield less than the shorter term bonds, this is a bearish indication (Inverted Yield Curve - IYC) and a sign of a weakening economy and in some cases, an oncoming recession.

Fed Speak
This is an event which happens when the Fed Chairman (and in recent times, the Ex-Chairman) or any FOMC member gives a public speech. Some, if not most, of these speeches tend to give away hints of what to expect at the next FOMC meeting. The market often reacts to these hints.

Geopolitical Situations
Think civil unrest, polls, coups, etc. Also think hurricanes, tsunami, earthquakes, etc. These are events that could move markets worldwide. In such situations, certain stocks will rise while others fall, depending on which stock stands to benefit from such events and which ones don’t.
  Post added on July 26,2007
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