When you read most of the mainstream financial media this week, they got more negative on the financial markets. People start talking about a double dip recession,all of a sudden Nouriel Roubini, David Tice and Peter Schiff are being interviewed again, when almost nobody wanted to know what they had to say before the so-called ‘flash crash’. Instead of a ‘correction’ they now start calling this the return of the bear market.
All of the above for me just shows that you cannot make trading decisions based on news events (except for daytrades were your holding period is very short).Most of the time journalists and politicians are just reacting to the market and only rarely does the market have a significant long term reaction to news or statements of a politician.
As a person i hope that we find a way to get out of this crisis, regulate the derivatives market and use them in a responsible way. But as a trader i just don’t care. Thinking about all those things is good and necessary,but as a trader you shouldnt base your decisions to buy or sell on your macro opinions, unless your opinions are confirmed by price action.