Typical first reaction
Definition · Level 14 · Markets & pitch
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The usual market response to a surprise in the first minutes. A tendency, not a law: positioning and what was already priced in can shrink it or reverse it.
Example
Hot inflation data: yields up at 8:30, back near unchanged by 11:00.
Where Tradecraft teaches it
Level 14 · Markets & pitch, in the lesson “Explaining a move: the relationships and the chain”: The links between yields, bond prices, the dollar, gold and volatility that don’t go stale, and how to join them into an explanation.
Related terms
- Backed upDesk slang for yields rising, so bond prices falling.
- Chain of causesExplaining a market move as a sequence (news → what the market now expects → rates → currencies → shares and commodities) instead of a list of…
- Long-duration stockA share whose profits lie mostly far in the future (many growth stocks): a higher discount rate cuts its value more, so it is the most sensitive to…
- The rates channelHow a surprise reaches other markets: first what the market expects from central banks, then yields, then the currency, then shares and gold.
- “Are you sure?”Often a pressure test rather than a hint that you’re wrong: re-check in one line, then hold a correct answer, or fix a wrong one without fuss.
- CAC 40The Paris benchmark: 40 large caps listed on Euronext Paris, weighted by capped free-float market cap, base 1,000 at the end of 1987.