Author: Difficult to Understand SOL

Why is it that many times, before data is released, the market has already moved up or down?

Because the market never just trades on the "results," but more often trades on "expectations."

Many people understand the market like this:

Data is released, and the market reacts after seeing it.

But the real market is often not like this.

Truly sensitive capital rarely waits for answers to act. They will first judge: how might policies change next, where will funds flow, how will everyone's emotions go.

Once expectations are formed, prices will move first.

For example, if the market feels that the Federal Reserve will cut interest rates soon, gold, growth stocks, and BTC may react in advance. But when the actual day of the rate cut comes, the market may not show much fluctuation, and might even pull back.

It's not that good news is ineffective.

Rather, that good news has already been traded in the previous leg of the market.

Non-farm payroll data is the same.

If before the release market already expects employment to worsen, gold and bonds might rise in advance. When non-farm payroll data is indeed bad, gold may not necessarily continue to rise.

Because for the market, this is not "new news," just "validation."

So you will often see:

Good news comes out, and there is no increase.

Bad news comes out, and there is no drop.

Many people feel that the market is unreasonable.

Actually, it’s not that the market is crazy, but that the market has already gone ahead of the news.

Ordinary investors are most likely to lose money by only looking at news headlines.

They chase when they see good news and run when they see bad news.

But what should really be asked is:

Did the market have any expectations of this news beforehand?

Have funds already traded in advance?

Is it just starting to price now, or has it entered the realization phase?

The market is not trading today; the market has always been trading the future.

Behind the price movements is capital continuously betting on what will happen next.

So when looking at the market, you cannot just focus on "what happened."

You must also look at:

What did everyone think would happen before.

Does the current result exceed expectations.

Is capital continuing to price, or is it starting to realize.

Many market movements that seem unreasonable are because you are looking at results, while the market is trading on the expectation gap.

In summary:

The market does not wait for answers.

The market will only choose the future it believes in ahead of time.

By the time you see the news, capital has often acted for a long time already.

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