Module 8. Trading The News & Sentiment

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In this module we'll explore how traders deal with the news, market sentiment and how certain markets correlate with one another.  Every day is fast moving when it comes to news.  Economic releases, profit warnings, market sentiment surveys and indicators are published every day and each one of them can move a market.  We'll look at the main market movers and explore how they move the markets and how to trade them.

Sentiment allows us to solve the problem on volume in the forex markets.  Forex markets generally can't measure volume, because they're over the counter markets with no centralised control like the stock markets.  However, The Commitment of Traders Report (COT), published by The Commodities Future Trading Commission (CFTC) does measure currency future open positions.  This COT report can measure traders sentiment, which can take the place of volume.  

The COT doesn't just measure total open positions though.  It also measures traders net long and short positions.  In doing so the report can be a good indicator of reversal and trend.  We'll go on to discuss this in our  'COT - A Reversal and Trend Indicator' lesson .

We'll also have a go at explaining inter-market correlation and find out how gold, currencies, bonds etc.. relate to each other and affect your trading day.  Finally we'll speak a little about currency and how some currencies have relationships with one another.

Contents

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In this module we'll explore how traders deal with the news, market sentiment and how certain markets correlate with one another.  Every day is fast moving when it comes to news.  Economic releases, profit warnings, market sentiment surveys and indicators are published every day and each one of them can move a market.  We'll look at the main market movers and explore how they move the markets and how to trade them.

Sentiment allows us to solve the problem on volume in the forex markets.  Forex markets generally can't measure volume, because they're over the counter markets with no centralised control like the stock markets.  However, The Commitment of Traders Report (COT), published by The Commodities Future Trading Commission (CFTC) does measure currency future open positions.  This COT report can measure traders sentiment, which can take the place of volume.  

The COT doesn't just measure total open positions though.  It also measures traders net long and short positions.  In doing so the report can be a good indicator of reversal and trend.  We'll go on to discuss this in our  'COT - A Reversal and Trend Indicator' lesson .

We'll also have a go at explaining inter-market correlation and find out how gold, currencies, bonds etc.. relate to each other and affect your trading day.  Finally we'll speak a little about currency and how some currencies have relationships with one another.

Contents

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