{"id":19913,"date":"2011-03-03T13:55:07","date_gmt":"2011-03-03T18:55:07","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=19913"},"modified":"2011-03-03T13:55:07","modified_gmt":"2011-03-03T18:55:07","slug":"breaking-news-bulletin-news-is-not-the-main-driver-of-stock-market-trends","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/03\/03\/breaking-news-bulletin-news-is-not-the-main-driver-of-stock-market-trends\/","title":{"rendered":"Breaking News Bulletin: News Is NOT the Main Driver of Stock Market Trends"},"content":{"rendered":"<h3><span style=\"font-size: small;\">A FREE myth-busting report from Club EWI reveals the real force behind long-term trend in financial markets <\/span><\/h3>\n<h3><span style=\"font-size: small;\">By Elliott Wave International<\/span><\/h3>\n<p>Conventional economic wisdom is founded on one core concept:                   namely, that events that exist outside the market (part of &#8220;market                   fundamentals&#8221;) trigger trend changes in the financial                   markets.<\/p>\n<p>Because of this belief, you have the mainstream experts of                   finance watching everything from weather patterns to crop conditions,                   political exploits to the subtlest changes in punctuation in                   the Fed&#8217;s minutes &#8212; all in the hopes of anticipating the next                   big move in commodities, stocks, gold, the dollar, etc. In                   a nutshell,  &#8220;positive&#8221; news and events cause a rise                   in prices, while &#8220;negative&#8221;  news pushes prices down.<\/p>\n<p>In reality, however, things are not as clear-cut. Markets                   regularly &#8220;ignore&#8221; the news, shrug it off &#8212; and                   move in the opposite direction of their &#8220;fundamental&#8221;  cues.                   OR, worse waver in two different directions after the same                   event.<\/p>\n<p>Take, for instance, the recent slew of news items following                   Federal Reserve chairman Ben Bernanke&#8217;s March 1 testimony before                   the Senate Banking Committee:<\/p>\n<ul type=\"disc\">\n<li>&#8220;US Stocks Advance Ahead of Bernanke&#8217;s Testimony&#8221; (International                     Business Times)<\/li>\n<li>VERSUS &#8212; &#8220;US Stocks Turn Lower As Bernanke Testifies                     To Congress&#8221; (NASDAQ)<\/li>\n<li>VERSUS &#8212; &#8220;US Stocks Rise With Bernanke In Focus&#8221; (MarketWatch)<\/li>\n<li>VERSUS &#8212; &#8220;Stocks Decline As Bernanke Comments Fall                     Flat.&#8221; (Wall Street Journal)<\/li>\n<\/ul>\n<p>What often ends up happening is this: Because the original                   event fails to predict the movement in stocks, commentators                   then sift through the day&#8217;s news feed in search of a different  &#8220;trigger&#8221; &#8212;                   one that fits price action AFTER the fact.<\/p>\n<p>The fallacy of a news-driven market is the first misconception                   exposed in Elliott Wave International&#8217;s Club EWI free resource <a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa168&amp;dy=aa030211&amp;url=http:\/\/www.elliottwave.com\/iie\/iiebook_b.aspx?code=29982%26articleid=2066\">&#8220;<span style=\"text-decoration: underline;\">The                   Independent Investor&#8221; eBook.<\/span><\/a> Here&#8217;s a short preview                   of this eye-opening report.<\/p>\n<p>Chapter 1 opens with the question &#8220;What Really Moves                   the Market?&#8221; You then get the answer via riveting excerpts                   and charts from EWI president Bob Prechter&#8217;s monthly Elliott                   Wave Theorist publications, such as this one below:<\/p>\n<blockquote><p>&#8220;Suppose the devil were to offer you historic news                     days in advance. He doesn&#8217;t even ask you for your soul in                     exchange. He explains, &#8216;What&#8217;s more, you can hold a position                     for as little as a single trading day after the event or                     as long as you like.&#8217; It sounds foolproof, so you accept.                     His first offer: &#8216;The President will be assassinated tomorrow.&#8217;                     You can&#8217;t believe it. You and only you know what&#8217;s going                     to happen. The devil transports you back to November 22,                     1963. You short the market. Do you make money?<\/p>\n<p><img decoding=\"async\" src=\"http:\/\/www.elliottwave.com\/images\/freeupdates\/kennass.GIF\" alt=\"DJIA Daily 1962-1964\" \/><\/p>\n<p>The first arrow in Figure 6 shows the timing of the assassination.                     The market initially fell, but by the close of the next trading                     day, it was above where it was at the moment of the event.                     You can&#8217;t cover your short sales until the following day&#8217;s                     opening because the devil said you could hold as briefly                     as one trading day after the event, but no less. You lose                     money.&#8221;<\/p><\/blockquote>\n<p><span style=\"text-decoration: underline;\"><a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa168&amp;dy=aa030211&amp;url=http:\/\/www.elliottwave.com\/iie\/iiebook_b.aspx?code=29982%26articleid=2066\">Independent                   Investor eBook<\/a><\/span> further exposes 10 other commonly held economic                   beliefs for what they truly are: Wall Street myths disguised                   as reality. Here&#8217;s what else you&#8217;ll learn:<\/p>\n<ul type=\"disc\">\n<li>The Problem With \u201cEfficient Market Hypothesis\u201d<\/li>\n<li>How To Invest During a Long-Term Bear Market<\/li>\n<li>What\u2019s The Best Investment During Recessions: Gold,                     Stocks or T-Notes?<\/li>\n<li>Why       &#8220;Buy and Hold&#8221; Doesn\u2019t Work Now<\/li>\n<li>How To Be One of the Few the Government Hasn\u2019t Fooled<\/li>\n<li>How Gold, Silver and T-Bonds Will Behave in a Bear Market<\/li>\n<li>MUCH MORE<\/li>\n<\/ul>\n<p>Keep reading this 118-page <em>Independent Investor eBook<\/em> now,                   free &#8212; all you need\u00a0is a <span style=\"text-decoration: underline;\"><a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa168&amp;dy=aa030211&amp;url=http:\/\/www.elliottwave.com\/iie\/iiebook_b.aspx?code=29982%26articleid=2066\">free                   Club EWI profile<\/a>.<\/span><\/p>\n<div>\n<p><em>This                     article was syndicated by Elliott Wave International and                     was originally published under the headline <a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa168&amp;dy=aa030211&amp;url=http:\/\/www.elliottwave.com\/freeupdates\/archives\/2011\/03\/01\/Breaking-News-Bulletin-News-Is-NOT-the-Main-Driver-of-Stock-Market-Trends.aspx%26articleid=2066\"><strong>Breaking News Bulletin: News Is NOT the Main Driver of Stock Market Trends<\/strong><\/a>.                     EWI is the world&#8217;s largest market forecasting firm. Its staff                     of full-time analysts led by Chartered Market Technician                     Robert Prechter provides 24-hour-a-day market analysis to                 institutional and private investors around the world.<\/em><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Conventional economic wisdom is founded on one core concept: namely, that events that exist outside the market (part of &#8220;market fundamentals&#8221;) trigger trend changes in the financial markets&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-19913","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/19913","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=19913"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/19913\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=19913"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=19913"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=19913"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}