In last week’s webinar, “Stay in Step with the Market,”  in addition to discussing a“market of stocks”and the current market, the Marketsmith team also covered questions from our members. One such topic was the effect of macroeconomics on the market. Whether it is a Fed statement or the economic situation in Greece, macroeconomic stories always seem to make the front page of financial sites. But just what is the connection between these events and market behavior? Obviously, it’s very unpredictable. The reaction can seem completely random, yet it has the power to move the market against its current trend. So how should we as investors react when this type of data is released?

 

It’s a bit of a trick question. Our answer is always simple: Don’t react to news.  Listen to the market. If you are well in tune with the overall market direction and understand what’s normal and abnormal behavior for the stocks you hold and watch—you’ll know what to do based on those specific movements.   

 

If you have any questions, you can reach us at 1(800) 424-9033, or at reachus@marketsmith.com.

 

Best returns,

 

The MarketSmith Team