What does "priced in" mean in trading?

It means that an expected outcome has already been reflected in current market prices before the official event or data release, which is why markets often react more to surprises than to the outcome itself.

Why do markets sometimes not react to major news?

If the actual outcome matches what was widely expected, there may be little new information for the market to react to, since that expectation was already priced in beforehand.

Why would a stock fall after a company reports good earnings?

This typically happens when results, while positive, fall short of even higher expectations already priced into the stock, or when forward guidance disappoints relative to what the market anticipated.

How can traders use market expectations in their strategy?

By tracking consensus estimates ahead of major releases and paying attention to how confidently the market has positioned for that outcome, since the gap between expectation and actual result is often what drives the biggest price moves.