Trading catalysts

Understand the Triggers of Market Volatility-and Take Advantage of ThemActionable lessons from 25 years of major events-and the market's reactions to themPredicting the market impact of everything from Fed statements to natural disastersSeparating real information from noise, major "market movers" from triviaIn Trading Catalysts, Robert I. Webb examines the various factors that move markets. Webb focuses on the catalysts that spark the biggest price changes-and the greatest potential for substantial profits or losses. Using numerous real market examples, Webb demonstrates the often inconsistent response of prices to similar trading catalysts across markets and over time, the occasional significantly delayed response, and the frequent market overreaction. Whether traders bet directly on a trading catalyst, on the presumed market reaction (or overreaction) to it, or not at all, the potential impact on market prices and volatility means that all traders must pay attention to trading catalysts and the market reactions that they induce. At the very least, the prospect of significant volatility around some event may affect the timing of a trader's entry or exit of positions and may cause a trader to reduce his position size. If you're a serious trader, this book will help you understand the influence of trading catalysts and identify potential trading opportunities.Volatile financial markets create both the risk of substantial losses and the opportunity for substantial gains. Sudden jumps or breaks in prices can impart a roller-coaster-ride-like quality to trading or investing in financial markets. Trading Catalystsis the first complete guide to the events that spark large changes in prices. These include: central bank actions; ill-advised comments by policymakers; news of natural disasters; elections; certain economic reports; terrorism; company specific announcements; the unwinding of large positions by key market participants; and simple trading errors among others. The varied origin of trading catalysts means that some traders may have an edge in anticipating the market's reaction to certain trading catalysts. Numerous real market examples take the reader into the heart of the market to illustrate the direction, magnitude, speed, duration, intensity and breadthof influence of trading catalysts on market prices. Because a minute can be a "lifetime" in the world of trading, many of the detailed examples recount moment-by-moment and tick-by-tick changes in market prices. This book discusses the role that trading theses(or prevailing beliefs about market relationships), market conditions,and sentimentplay in determining how prices react and sometimes overreact to various trading catalysts over time. Trading Catalysts will help readers anticipate potential events that could spark rallies or breaks; predict situations with feedback loops that drive markets up or down; and identify situations where substantial overreactions are likely to occur.Size Matters:When key players unwind positions and move the marketsThe Information in Economic Reports: Rout or Rally?Uncertain market reaction to the forecast errors from economic reportsTalk Isn't Cheap:When the comments of politicians and policymakers move marketsMarket Interventions:When governments intervene: case studies, from currencies to oilGeopolitical Risk:From elections to terrorism to warsBubbles, Crashes, Corners, and Market Crises:Lessons from the "silver corner," the 1987 stock market crash, and the Asian Financial CrisisQuantifying the Market Impact of Natural Disasters:From earthquakes to...