When fundamental factors or economic
data become the key attention of the market, technical analysis will not work
since traders become sensitive to any changes.
News Releases major news releases like US non-farm payrolls have created
situations in the market that are incompatible with technical analysis as
volume and volatility spikes, depending on the increase of speculation on the
possible results. Although the aftermath more than not will once again adhere,
the mass speculation that ensues makes sure that traders are scrapping for the
best price available in filling their positions rather than applying your every
day moving average or price oscillator
Central Bank Intervention The Bank of Japan serves as an excellent example of the
Central bank intervention of throwing a "monkey wrench" into the best
technical analysis. The main purpose of the intervention of the Bank of Japan
is to not only modify spot prices but also to ensure washing out speculators.
As a result, in order to achieve support or resistance levels, improbable
levels will be targeted by bank officials. Volatility spikes as risk-takers try
to be captured in a drive trade and others attempt to exit at the best price
available, the moment intervention efforts are spotted
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