"Buy the rumor, sell the news" is a common phenomenon in the financial market and a typical trend pattern. Whether translated as buying expectations or selling news, it means the same thing.
Simply put, investors rely on "news", which can be various bullish (rising) or bearish (falling) rumors, and buy (or sell) the commodity in stages. At this time, due to the large number of buy (sell) orders, the commodity price moves in the expected direction. When the news is confirmed or the news is announced, the result may not be as expected or just meet the expectations. Many investors who entered the market before may choose to take profits at this time. If the herd effect occurs, causing investors to rush to close their positions, the price will obviously reverse, resulting in a "selling fact" situation.
Economics points out that what influences people's current investment behavior is the "expectation" of future economic changes, rather than what is happening now. Expectations are estimates and expectations, which are more subjective and may deviate from objective facts. However, investors need to know that people make investment strategy arrangements by judging the future and predicting market information that has been revealed to a certain extent. Because investment behavior directly affects prices, it is expectations that dominate price trends, rather than established facts, and prices will not react until the news is confirmed.
This is also a common term in the financial market, and there is also "bad news is good news". For example, in the market, the prices of certain financial products fall due to various bad news. However, after the downward trend continues for a period of time and reaches a certain level, the strength of the short side will gradually weaken, which means that investors are no longer affected by bad news, and prices tend to calm down or even begin to show signs of rebound. This situation is called "bad news is good news". On the contrary, it is called "good news is bad news".
We can interpret this as the price already reflecting the impact of past news, that is, the market has "digested it". The so-called digestion or reflection is also the meaning of the English term "priced in", which generally means that the price already includes known and reasonably expected factors.
All financial products traded on margin carry a high degree of risk to your capital. They are not suited to all investors and you can lose more than your initial deposit. Please ensure that you fully understand the risks involved, and seek independent advice if necessary.