In this week’s episode, the core focus is about cause and effect ripples in the stock market. Basically it’s how the market moves, what is the cause and what is the effect and how that pertains to everything that’s happening within your stocks.
It’s an important lesson to really hone in and focus on because there’s a lot of chatter that’s happening lately, especially between oil, the Federal Reserve and the US dollar.
Lots of news
There’s a lot of news, a lot of gossips, a lot of headlines that is occurring and it may be impacting your trading decisions and it’s something to be aware of, of how the news pertains to your trades and your stocks and your environment, and seeing a deeper picture about this and how it really applies is vital to understanding your trades and how stocks move and behave.
As we go into the lesson, I do want to cover the market and how it’s doing, we did have the Federal Reserve that announced certain news yesterday about the interest rates going up, and they’re by about a quarter percent.
And what they say typically does move the markets because it trickles down, so if you look at the market, a lot of things over the last week actually were just waiting for the Federal Reserve over the week.
What happens is a lot of the traders, what they do is they pair their positions. That’s one of the reasons why I also decided that ok, we’re going to turn down a lot of my positions as well and since we’re getting close to the holidays, then we won’t be putting on any new positions here until the new year, and that’s just also to get a little break as well from everything.
But you can see that people were taking a lot of positions off right here, as indicated by this bar and the break of this support line. So we broke it before right here, right around November 15th, 16th and then we got back above it.
The same thing happened here, was that we broke lower, a lot of people were waiting for the federal decision and then we got it and then some certainty came in and the stock market popped a little higher, and then today we get again a reaction that goes and counteracts that decision, so on the day that they announced it, the stock market went higher. On the day after today, the stock market went lower.
So why does that happen and why does that move the markets? Or how does this play into the whole market as a whole between the causes and the effects? Is this the thing that’s leading it? Is it oil prices, or is it the dollar and the way that the dollar is moving?
The news only want to entertain viewers
That’s the core of this week’s lesson. And you have to understand that there’s going to be a lot of chatter that happens on the news. There’s going to be a lot of chatter that happens that the news will bring in experts that had it right and then experts that had it wrong, depending on the direction that things move.
And they do this because it builds viewership; it builds viewing time for them and for their channel.
#stockmarket #federalreserve #interestrates #tradingeffect #causeandeffect
Posted at: https://tradersfly.com/blog/cause-effect-ripples-oil-fed-dollar/
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