Charts vs. Fundamentals

[AlterEgo]

Re: Charts vs Fundamentals

Fundamentals do so too... Extrapolation based on PAST company announcements, earnings, ratios etc. A t/a plan could be flexible too, doesn't have to change daily, can change weekly, hourly etc...
Same difference imo, both are representations of past data.

Yep, I agree. All information known about a company, whether fundamental or technical, is all based on past history. Neither can predict the future.

 

[cordelia]

Re: Charts vs Fundamentals

It is true that charts do only record the past but I have often considered what are they actually recording?.....I perceive a chart to be a visual representation of past human behaviour in relation to a particular stock....

Clearly charts cannot predict the future..but they can draw attention to past patterns of human behaviour.....and as such illuminate possible trading opportunities....

I don't believe that fundamental analysis and technical analysis are mutually exclusive...IMO To ignore fundamentals and only trade according to the charts is as blindsighted as only paying attention to the fundamentals with little regard for charts....There needs to be a balance..


Our current market situation highlights this so well.....The financial turmoil is unprecedented..charts reflect the past...so relying on them as the sole indicator for a trade in this market is unreliable....

 

[The Edge]

Re: Charts vs Fundamentals

Friday 31 October 2008

To the comment:

> TA does work, sometimes fabulously, sometimes it fails.

TA does not fail, it is the one employing it improperly
that fails.


To the opinion:

> IMO To ignore fundamentals and only trade according
> to the charts is as blindsighted as only paying attention
> to the fundamentals with little regard for charts....There
> needs to be a balance..


Actually, what are charts but a pictorial representation of
the fundamentals, in part, and the most accurate depiction
one can have of all the forces of supply and demand that
makes a market move.

Fundamentals, while important, are also relative, and
perceptions about them can change. Tell me how to
extract that from the fundamentals?

Charts will always show it. Argue it however you will,
facts are facts. Charts are facts in print.

[This is not to suggest that knowing how to read these
facts is easy. Many technical analysts have their
analytical heads up their opinions.]

TA is an art, pure and simple.

A market, in and of itself is neutral. All it does, and all it
can do, is reflect the results from the meeting of buyers
and sellers at any given time. Being neutral, the "market"
has no opinion, no beliefs. The opinions and beliefs about
the market arise from those participants placing their bets,
as it were.

When you hear someone say, "The market got me today,"
or "The market killed me," it is an abdication of
responsibility. The market is a meeting place. It could
care less what your opinions/beliefs are as you place a
trade. If a trade is done unwisely, it is not that the
market "got you," rather, you did not know what you
were doing at the time you did it.

Motorway expressed it well, "Markets do not predict,
they reveal."

How one choses to participate in a market is the most
revealing of all.

Just a few thoughts.

 

[Glen48]

Re: Charts vs Fundamentals

In my humble opinion a lot is second guessing, price oil goes down so Airlines go up but commonsense tells you Oil is going up and down like *****s draws.
Platinum goes down because cars sales are down, cars use Platinum in Cat.converters in the exhaust system.
A company makes a profit yet their shares take a dive because punters expected a bigger profit.
Dow rises Friday night in USA by 9% and in OZ we get 1% increase.
USA is Bankrupt yet the USD is good.
Gold should be going skywards yet it is hovering around $700 + - 10 cents.
I would be looking at insurance Companies taking a dive as things get tighter the average home owner will cut out / cut down their insurance
Can any chart/system predict that?

 

[nunthewiser]

Re: Charts vs Fundamentals

In my humble opinion a lot is second guessing, price oil goes down so Airlines go up but commonsense tells you Oil is going up and down like *****s draws.

ahha but the smarter ones like QAN hedge part of there fuel costs when the price is low

 

[tasmanian]

Re: Charts vs Fundamentals

I think the market of late should finally answer the fundamental Vs chart debate.

Fundamentalists would be down alot more than anyone half decent in reading charts over the last 12mths.

Comments should be some good reading.

cheers.

 

[arco]

Re: Charts vs Fundamentals

.
I do bad with FA

I do good with TA

So IMO stick with what works for you.

rgds - arco

 

[The Edge]

Re: Charts vs Fundamentals

Saturday 1 November 2008

> Can any chart/system predict that?

Ask the wrong question, and you will get
the wrong answer every time.

For clarity, charts do not predict.

 

[tasmanian]

Re: Charts vs Fundamentals

charts do not predict but they definetely give you an edge

 

[nulla nulla]

Re: Charts vs Fundamentals

Most breakouts I have seen, rarely seem to have been influenced by chartists interpretaion of their wiggly lines suddenly deciding enmass "now is the time to buy or sell". I would suspect most surges or plunges, evidencing a break out, are the results of leaked information and the people in the know moving to take advantage.

 

[tech/a]

Re: Charts vs Fundamentals

Having been charting for 14 yrs my conclusion is that charts are a graphical representation of crowd behaviour.
You can read it.
You can take advantage of it.
You just need to know how.

Does it make you the money?
Application is just the vehical---controlling risk is the fuel.
Money/Trade management is the driver (You).

Put it all together you get a profitable business---the end destination.

 

[Garpal Gumnut]

Re: Charts vs Fundamentals

If you want a good laugh at fundamentalists read what the "experts" have to say in this weekend's afr.

"Maybe this, could be that, long term, time to buy, earnings, valuations more realistic, we have cut our targets, may be too soon, prescient to buy, etc etc."

It reads more like the Beano than a financial newspaper.

gg

 

[MRC & Co]

Re: Charts vs Fundamentals

.
I do bad with FA

I do good with TA

So IMO stick with what works for you.

rgds - arco

Good post arco.

While I pretty much use 100% technical, you cannot write off the use of fundamentals. Tudor-Jones and Soros (I believe use global macro along with technicals) and we all know about Mr Buffett (though no doubt, he knows a lot more than just fundamental analysis).

Once again, IR announcement this Tuesday, a case where fundamentals can potentially be used to trade and make much more $$$ than most technicals can make you in a month (or more than most make in a year or two). Some will argue you can see this in the chart anyways, but knowing the news is coming and getting in first (a split second earlier), not only gives you the conviction to do so with big size, but also the ability to be the first to get in, before the chart even reveals the breakout (and you don't even need inside information ).

 

[nunthewiser]

Re: Charts vs Fundamentals

uses both ........ st trades 90% ta .....long term investing 80% fundamentals and 20% ta for entry point purposes

 

[skyQuake]

Re: Charts vs Fundamentals

Most breakouts I have seen, rarely seem to have been influenced by chartists interpretaion of their wiggly lines suddenly deciding enmass "now is the time to buy or sell". I would suspect most surges or plunges, evidencing a break out, are the results of leaked information and the people in the know moving to take advantage.

Probably true in relation to speccys, but even then, those insiders need to be positioned (accumulation in the consolidation) before the surge (public buying). Charts will alert you to consolidation and the early stages of the surge.

Breakouts in shorter timeframes in relation to trading futures can be played with technicals, although its a fair bit different from traditional charting methods.

 

[Value Hunter]

Hope you chartists have fun with your squiggly line voodoo. I just laugh when I see people use charts. Might as well be reading tea leaves.

I'll just stick to the fundamentals thanks

 

[McLovin]

Hope you chartists have fun with your squiggly line voodoo. I just laugh when I see people use charts. Might as well be reading tea leaves.

I'll just stick to the fundamentals thanks

You had to drag up a six year old thread to start a tech v fundamental argument. Great.

 

[barney]

Hope you chartists have fun with your squiggly line voodoo. I just laugh when I see people use charts. Might as well be reading tea leaves.

I'll just stick to the fundamentals thanks

I agree 100% .... 100% ......... now, back to my charts:

 

[rb250660]

Us tasseographists are outraged!!

You've made me so angry I'm going for a cup of tea so I have something to read later.

 

[ThingyMajiggy]

Hope you chartists have fun with your squiggly line voodoo. I just laugh when I see people use charts. Might as well be reading tea leaves.

I'll just stick to the fundamentals thanks

So you knew the DAX was going to drop 250 points yesterday and recover most of it back up by the end of the session with fundamentals? Interesting, enlighten us.