TWO TRADERS. A LESSON.
EP. 11 — THE NEWS IS GOOD… BUT WHAT ABOUT THE PRICE?
Rui walked into the room feeling quite excited.
Rui:
— Dário! Did you see the news? It’s excellent! There’s good news about the market. I think it’s time to buy!
Dário looked at the chart before answering.
Dário:
— And what is the price doing?
Rui:
— It’s… going up.
Dário:
— Is it going up enough to confirm your idea?
Rui looked back at the chart.
Rui:
— It still hasn’t broken through that resistance.
Dário took a small puff from his pipe.
Dário:
— So you have good news… but you still don’t have market confirmation.
Rui:
— But if the news is good, shouldn’t it go up?
Dário:
— Not necessarily.
Rui:
— What do you mean?
Dário:
— The market may have already priced in the news. There could be sellers in that area. Or simply other factors may be weighing more.
Rui looked thoughtful.
Rui:
— So a good news story can show up and the price stays still?
Dário:
— It can. It can rise. It can fall. That’s why we shouldn’t negotiate based on the headline alone.
Rui pointed at the chart.
Rui:
— So what should I look for?
Dário:
— Information first. Then, observe the price reaction.
Rui:
— And only then do I make the decision?
Dário:
— Exactly. The news presents a possibility. The market shows the reaction.
Rui took a deep breath.
Rui:
— So I shouldn’t buy just because I liked the news.
Dário:
— Now you’re thinking like a trader.
LESSON OF THE DAY
A news piece can be positive and, even so, the price may not react the way we expect.
News is information.
Price is reaction.
Confirmation is different from expectation.
Don’t trade only the news. Watch how the market reacts to it.
A good news doesn’t guarantee an up move and a bad news doesn’t guarantee a drop.
Before deciding, ask: has the market confirmed the narrative?
$BTC $SUI
Strategy beats emotion.
#BinanceSquare #Trading #Crypto #RiskManagement #Trader #Mindset #DYOR
EP. 11 — THE NEWS IS GOOD… BUT WHAT ABOUT THE PRICE?
Rui walked into the room feeling quite excited.
Rui:
— Dário! Did you see the news? It’s excellent! There’s good news about the market. I think it’s time to buy!
Dário looked at the chart before answering.
Dário:
— And what is the price doing?
Rui:
— It’s… going up.
Dário:
— Is it going up enough to confirm your idea?
Rui looked back at the chart.
Rui:
— It still hasn’t broken through that resistance.
Dário took a small puff from his pipe.
Dário:
— So you have good news… but you still don’t have market confirmation.
Rui:
— But if the news is good, shouldn’t it go up?
Dário:
— Not necessarily.
Rui:
— What do you mean?
Dário:
— The market may have already priced in the news. There could be sellers in that area. Or simply other factors may be weighing more.
Rui looked thoughtful.
Rui:
— So a good news story can show up and the price stays still?
Dário:
— It can. It can rise. It can fall. That’s why we shouldn’t negotiate based on the headline alone.
Rui pointed at the chart.
Rui:
— So what should I look for?
Dário:
— Information first. Then, observe the price reaction.
Rui:
— And only then do I make the decision?
Dário:
— Exactly. The news presents a possibility. The market shows the reaction.
Rui took a deep breath.
Rui:
— So I shouldn’t buy just because I liked the news.
Dário:
— Now you’re thinking like a trader.
LESSON OF THE DAY
A news piece can be positive and, even so, the price may not react the way we expect.
News is information.
Price is reaction.
Confirmation is different from expectation.
Don’t trade only the news. Watch how the market reacts to it.
A good news doesn’t guarantee an up move and a bad news doesn’t guarantee a drop.
Before deciding, ask: has the market confirmed the narrative?
$BTC $SUI
Strategy beats emotion.
#BinanceSquare #Trading #Crypto #RiskManagement #Trader #Mindset #DYOR
