Anthony Cheung from Amplify Trading explains how to prioritize news for trading. He uses a hierarchy of influence to identify which story moves markets most, showing how Trump's agenda dominated 2017 sentiment over other geopolitical events. Assigning daily priorities cuts through noise and aligns you with what the broader market actually cares about.
Chapters
Hi, my name is Anthony Cheung and I'm a director here at Amplify Trading. I've worked in financial markets now for over 12 years with my specialism being in delivering real-time market news and analysis to a variety of different investors ranging from proprietary trading firms, hedge funds, and investment banks. To individual retail clients. The topic we're going to cover is an introduction to how Amplify approaches trading the news, or in fact, understanding the implication of news to make better trading decisions. This short session is aimed at providing you with a concise framework of how to make sense of the immense amount of information that you're exposed to every day as a trader. Big leaps in technology have drastically changed the way today's markets function. Not only from an execution point of view, but in how quickly sentiment can change and asset prices fluctuate given a new piece of breaking information. Our job as market participants is to effectively cut through the noise, to only pick up on the information that will move financial markets. Before we begin, I think it's important to stress that fundamental analysis should be seen as a complementary tool to your technical analysis. Rather than one discipline over the other. Having an awareness of the news and its impact is not just about trading short-term market movement, but more often than not, it's about capital preservation and being adaptable to changing sentiment should an unscheduled piece of news be released. Also, from my experience of working with institutional clients for many years, the understanding of current economic climate and the appreciation of future direction of monetary policy are the core competencies to making more informed investment decisions. So let's begin with understanding the broader picture and what I call macro themes. At any one point in time, there are usually several concurrent macro stories in play. An example of this might be the ongoing financial assistance required by Greece, or tensions on the Korean Peninsula, populism in European politics, The list goes on. The point is that although all of these are important in their own right, the market tends to focus on one prevailing theme over the rest. I call this the hierarchy of influence. Take 2017 for an example. Topics such as Brexit, Catalonia's push for independence, North Korean missile testing were all memorable and had a marked impact at certain points in time, but the overriding theme was undeniable. Donald Trump. His style of leadership, outspokenness, and then the passage of the US corporate tax cut plan meant that market direction in the global sense would derive largely from this one man's agenda, given his control over the world's largest economy. Assigning a hierarchy to the news each day is crucial, as without doing so would mean that you'd be inundated with new information 24/7. But by being selective and understanding what it is that the broader investment community is prioritizing is key. Don't forget, to better determine the direction of market is about thinking, what is it that's driving the investment decisions of the many, not the few?
