If you are a day trader, you must stay alert to market news at all times. If you are a swing trader, it helps to stay alert to market news because it helps you find more winners and fewer losers. Remember the times when a stock chart looks bullish and all the technical indicators pointing to a higher price yet the stock still goes down the next day? Chances are the stock might get drag down by the general market. When Dow is down over 100 points, people just dumping their shares for no reason. In addition to that, short sellers start adding to their position and further drags the Dow down. Stock market always seem to go down faster than when it goes up, isn’t it? When a majority of stocks are down on the day, it is hard for your stock to go against that trend and it may eventually go down. That’s why it is important to stay alert to stock market news. Here are some things that you should do.
1. Watch CNBC or listen to bloomberg radio. If you are trading for a living, you should definitely do that. If you trade part time, make sure you listen to bloomberg radio while driving to work or on the train.
2. Wall Street Journal – If you commute and take public transportation to work like I did in the past, you should read Wall Street Journal during the trip instead of sleep. Click here to visit the Wall Street Journal Site for more information.
3. You must know what news or reports will affect the stock market tomorrow. There are a bunch of economic indicators that are release on a weekly or month basis and some of them has major effect on the stock market. Check out this list for all the important reports that will come out each day. http://www.marketwatch.com/economy-politics/calendars/economic. If you are not sure which ones are important, that’s ok. Next time when Dow goes up or down 100 points after a certain report is out, you will know that is an important one. Some reports are more important and has a bigger effect on the stock market during different times. For example, economic report is an important one in a bear market.
The following economic are pretty important regardless of the market.
- Employment Situation
- Unemployment Insurance Weekly Claims
- Consumer Price Index (CPI)
- Producer Price Index (PPI)
- Retail Sales
- Institute for Supply Management (ISM)
- Durable Good Orders
- Gross Domestic Product (GDP)
