“First the doctor told me the good news: I was going to have a disease named after me.”
As long as markets have existed, savvy traders have paid attention to the market’s reaction to significant (potentially market-moving) news. This was true in the days of the ticker tape and is still true in today’s electronic age.
Significant news should, by definition, result in a significant market reaction. But it doesn’t always happen, and many times the reaction is opposite of what’s commonly expected. In this chapter, I present my “significant news indicator” (SNI). The SNI will help you trade the market’s reaction to news. It’s as much a trading philosophy as an indicator, but because we’re able ...