The key financial events which have a profound impact on market movements explained. Determine the different markets, sectors, and events you will need to be aware of as a trader.
Bank of England
Why are financial events related to market sentiment?
- Market sentiment refers to the general attitude of investors towards a certain asset or market. If prices rise then this is known to be a bullish market sentiment, in the same way, if prices drop then that is known as a bearish market sentiment.
- Before major financial event occurs, or if there is an expected announcement and release of financial data, traders will have different methods to measure market sentiment in order to place their trades. Macroeconomic factors have an unbelievable bearing on the market and can ultimately influence a trader’s decision.
Technical VS Fundamental Analysis
To gauge market sentiment and to decide when the right time is to open and close a position, traders will use technical and/or fundamental strategies.
Fundamental analysis looks at the financial security as a whole and the factors that can affect its performance on the market such as politics or company news. Technical analysis, on the other hand, evaluates the price of the financial asset through a series of statistics and quantitative methods as opposed to qualitative data.