News could always be deceptive for a Technical Analyst, who makes decision only based on his charts.
Above is a 15 min chart of Crude. What can clearly be seen is a Triangle Pattern with a break on the upside.
It also has a classic trendline retest. The target according to this triangle breakout is 79.20$
So all I knew was that Crude should take support at 76 & move towards achieving its target of 79.20$
Now comes the interesting part
Every Wednesday Energy Information Administration comes out with Crude inventory data at 8.00 p.m IST.
Its a high Drama event and traders wait as Data comes out because Crude moves like anything before & after this Data is public.
At 8.00 p.m. today Data for Crude Inventory was out as ==> ACTUAL 1.7 M, EXPECTED -1.5M, PRIOR -1.8M
Its a highly Bearish data for crude. The Actual Inventory change has come positive 1.7M, where negative 1.5M was expected.
I got panicked & yelled SELL.
The chart shows the time when data came out...At 8.00 p.m. when data arrived, Crude was trading at 76.84$
Within the next 20 mins Crude made a low of 76.22$and then started rallying
By next 1 hour Crude was above the level where it was when data came out & kept rallying further & made a days high close to 78$.
The argument here could be that "News is already factored in"...
But if a Bearish Data was to be 'factored in' in advance , the trend should had been down before the data arrived not up.
The chart shows a trend in Crude which is UP.
News will have effect on the prices only momentarily. Don't be deceived my them...
Bottom line is " If you want to make trading decisions based on Technical Analysis, TRUST YOUR CHARTS, & DO HELL WITH THE NEWS "
