Dissecting why chasing news loses: the event is priced in by the time you read it, the first move whipsaws, and rumor-buy-fact-sell exhausts the move. The discipline of writing scenarios in advance, and of standing aside when you don't know.
How to Read
OANDA:USDJPY
At the entrance to trading, everyone is taught this once.
When a big headline drops, trade in its direction. News is the source of price movement.
It is half true. There is news behind the move. But the time ordering — "trade after the news appears" — is decisively wrong.
Price moves not on the news itself, but on the expectation of it, and on the gap between that expectation and the outcome. Long before the release, participants form forecasts, take positions, and bake that forecast into price.
If payrolls are expected at +180k, that +180k is in the price hours before the release. If it actually prints +180k, price barely moves. It was already priced in.
It moves only when the print and the forecast diverge. Only at +250k or +100k does price move — as a revision of what was priced in.
The accurate sentence is —
Price does not move the instant the news appears. The forecast is priced in beforehand, and the release settles only the gap against that forecast. The retail trader who jumps in after reading the headline is standing at the very back of that settlement queue.
How to Read
OANDA:USDJPY
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