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BIG Money and news releases

  • #1
  • First Post: Dec 26, 2006 7:12pm Dec 26, 2006 7:12pm
Opinion to everyone...

Do you believe that the Big Money out there (banks, countries, etc) have fore knowledge of the data that is to be released in news events?

Or do you think they just have their own in house research that comes up with similar numbers?

Reason I ask is that I have seen on more than one occasion, that there will often be price moves on a currency that come before a news event and then when the news comes out it goes opposite the direction the fundamentals say it ought to. Is this a classic case of the banks bidding the price up, and then when the news releases, they send it the other way? How do you feel about this?

Just trying to add some sense of logic to some of the action.

Your two cents worth is well appreciated.

GirlFlyer
  • #2
  • Dec 26, 2006 7:19pm Dec 26, 2006 7:19pm
Quoting GirlFlyer
Opinion to everyone...

Do you believe that the Big Money out there (banks, countries, etc) have fore knowledge of the data that is to be released in news events?
Yes, and it is legal, there is no SEC to come after them.
  • #3
  • Dec 26, 2006 7:34pm Dec 26, 2006 7:34pm
Quoting GirlFlyer
Opinion to everyone...

Do you believe that the Big Money out there (banks, countries, etc) have fore knowledge of the data that is to be released in news events?

Or do you think they just have their own in house research that comes up with similar numbers?

Reason I ask is that I have seen on more than one occasion, that there will often be price moves on a currency that come before a news event and then when the news comes out it goes opposite the direction the fundamentals say it ought to. Is this a classic case of the banks bidding the price up, and then when the news releases, they send it the other way? How do you feel about this?

Just trying to add some sense of logic to some of the action.

Your two cents worth is well appreciated.

GirlFlyer
i think the big money out there has their own money management and also their own purposes. some country release their money to the market not thinking to gain any pips at all. it solely for their own need for the currency. so can be say they put the position for the sake of putting position only. they need to trade. not to profit from the trade.

for banks i think more or less they ride the big trend and release their money based on averaging technique. let say they losses 20 pips, then they double the position, they still loses (n now 40 pips), then they times four and put another position. when the market gain the direction where they want it to go. they gain a lot of pips.

how d u think?
  • #4
  • Dec 26, 2006 7:46pm Dec 26, 2006 7:46pm
Quoting GirlFlyer
Opinion to everyone...

Do you believe that the Big Money out there (banks, countries, etc) have fore knowledge of the data that is to be released in news events?

Or do you think they just have their own in house research that comes up with similar numbers?

Reason I ask is that I have seen on more than one occasion, that there will often be price moves on a currency that come before a news event and then when the news comes out it goes opposite the direction the fundamentals say it ought to. Is this a classic case of the banks bidding the price up, and then when the news releases, they send it the other way? How do you feel about this?

Just trying to add some sense of logic to some of the action.

Your two cents worth is well appreciated.

GirlFlyer

I don't know about exoctic pair, but in the majors it is doubtful that data is available to a priveleged few ahead of time.

What happen many times is the announced data is not far off expectations so that market looking for something to react to will find a peice of data within the eco report (that happened on a recent NFP day).

Another scenario is when you have more than one announcement on the same day and time. Whipsaws can happen in these multiple data dynamics.
  • #5
  • Last Post: Dec 26, 2006 8:03pm Dec 26, 2006 8:03pm
Quoting GirlFlyer
Is this a classic case of the banks bidding the price up, and then when the news releases, they send it the other way? How do you feel about this? GirlFlyer
Three points:

(1) US news releases are a closely held secret, to the point of isolating financial news reporters (who receive press statements "x" minutes in advance) in a locked room with no outside communication, until the news is released.

(2) Government staff actually compute US data and perhaps one or two get compromised from time to time. In my experience, I've heard rumors of federal managers privy to such information, particularly for commodity releases, that are living "quite well", perhaps beyond their visible means of support. This is the most likely source of any leaks.

(3) Forex is so large that many banks and institutions would have to conspire at the same time in order to move the market in a certain direction. Possible but not probable.

My three pips worth.
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