The general public often think that they can watch the financial television channels, and make trades based upon the information that the news stories and market analysts provide. However, professional traders do not watch the financial news channels, so the only people trading based upon the television analysts are the general public (and the general public are always wrong).

This was proven recently when an analyst on a financial news channel was commenting on the Euro currency markets, and recommended that everyone buy Euros immediately, because the Euro was about to make a big move upwards. Any professional traders that heard this recommendation would have thought about making a trade, but they would have considered selling Euros rather than buying Euros (i.e. trading against the analyst's recommendation). It has been almost one week since the news report, and as expected, the EURUSD (Euro to USD currency market) has dropped approximately 300 pips (ticks).

The reason that this happens is that the general public are always the last group of traders to make any trades. In this example, once the general public had entered their long trades (by buying Euros), there were no traders left to continue the buying, so the market had to move downwards instead. Once the general public start to realize that the market is moving against their trades, they sell to exit their trades (or their stop loss orders start being executed), which provides more selling to continue the move downwards.

The next time that you hear a television analyst (or any analyst that is available to the general public) giving a trading recommendation, think like a professional trader, and either dismiss the recommendation, or consider making the opposite trade.