Talking Points:
• Event risk can offer a clear surprise and impact on the market or it can blur the market's view
• Wednesday, US GDP signaled a distinct view for the masses while the FOMC further stirred debate on hikes
• Both technicals and fundamentals can drive market moves or destabilize them
Want to develop a more in-depth knowledge on the market and strategies? Check out the DailyFX Trading Guides we have produced on a range of topics.
When many traders are presented with a market response to fundamentals that doesn't match fit the simple scenario expected, they deem the entire analysis technique unserviceable. Yet, do all technical patterns play out as expected? To we abandon the popular chart patterns or indicator cues for momentum, breakouts, reversals and other market developments when one signal doesn't fit the mold? Not likely. Both fundamentals and technicals can provide a clear spark that concentrates the market's view to a singular motivation. They can also stall market phases or diverge from expected designs. Markets and investing runs on probabilities, not certainties. We look at the difference between 'black-and-white' developments and those that are more appropriately termed 'shades of grey' with reference to today's US GDP release and the FOMC rate decision in today's Strategy Video.
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