Your argument was that price includes all information, including fraud. I pointed out in black and white that it does not show fraud. And you are cherry picking technical factors to support your arguments. Yeah support broke, but you wouldn't have even been looking at the asset. You'd be playing with yourself in QQQ or SPY or gold futures because you don't understand how to do proper fundamental analysis.
You mean paid. What people PAID for it in the past, which doesn't matter at all because it tells you nothing about what people will pay for it in the future.
Yes paid. A micro second ago and further back, which forms support and resistance plainly observed and taken into account in the future. Whether that future is a minute later or multiple decades later. Did FA cause these reversals? Which happen all the time on all timeframes, on all markets.
I can draw lines on charts too. You conveniently left out the resistance at 21:30, 1:00, 9:15, and support at 22:45, 21:30, 2:30, and 8:15, which didn't provide either, and would have left you with losses had you traded based on them. Now you have some lines. Cool. I have the advantage of seeing what came next... a move lower, slicing right through your support line at 148.70. There is now a new support level at 148.55, and the question is, WHERE DOES IT GO NEXT? You don't know because there is zero predictive power in technical analysis. How about a chart with your lines and a PREDICTION of the next move? I won't hold my breath... Did FA cause any of this? Nope. It's all noise. You're being fooled by randomness.
I love this, as a person who started as a Fundamentalist, with an Accounting Degree. But, you've incorporated Acounting, Finance and Economics into your Analysis. The average person firstly can't gain an understanding of all those fields of Study, then have access to the level of Information required to effectively crunch all those numbers. That's Institutional style Investing. Even George Soros uses some TA apparently
LOL. Does anything work 100% of the time? Fack no. Use what you want. Save the chitting on those who trade differently.
This is correct. They have already done that work and that is why QQQ, XLK, and VUG are all basically the same thing. No sense for everyone else to duplicate the efforts in the analysis. You should be spending your time creating technical strategies and indicators.
In my fundamental analysis, I focus on key factors such as the political landscape, economic indicators like inflation rates and interest rates, global economic events, and overall market sentiment. You can check this to learn about the basic of fundamental analysis. https://insights.primecodex.com/mastering-fundamental-analysis-in-forex-trading/
I think fundamental analysis has a bad name in the retail trading community because it is (1) hard to do -- almost no one knows how to do it here, (2) requires a more thoughtful analysis, and (3) requires substantial learning. The professional trading world is primarily driven by fundamental research. In reality, prices exhibit autocorrelation, mean reversion, and violent regime shifts (gaps). If you are serious about making money, you will want to differentiate between these characteristics and identify what will cause a shift in the characteristic or a level higher/lower. A person trading on just the technicals either doesn't have the curiosity or the skill to analyze the drivers of price and, therefore, won't have an edge or build cumulative excess pnl. Don't mistake visual learning with "technicals vs. fundamentals". Let's give an example of the USDJPY. Here's how you would approach this fundamentally: Start with getting "facts" -- what's happening and why? Well, from an asset perspective, USDJPY is an exchange rate, which means I can start with the international Fisher effect and work from there. The Fisher effect states that the exchange rate is primarily driven by the difference in interest rates between two countries ("interest rate differentials"). Fundamental insight #1: one driver of dollar-yen is expectations on the rate differential between the Fed and BoJ. The chart above also illustrates that rate differentials has been a better strategy than MoMo or mean reversion on USDJPY since Covid/2020. this likely has to do with the big policy differences between BoJ and the US Fed (and other DM central banks). From a trading perspective, the BIS compiles analysis of FX trading and liquidity which is insightful. As we can see, derivatives on spot make up 2/3rds of market turnover. This means that activity in the derivatives market for FX is likely driving shorter term price action in spot. If you know about how FX swaps are traded, when you know that dealers can manage delta risk through a variety of means including forwards, options, and dynamic hedging similar to options dealers in stocks. Fundamental insight #2: daily trading is dominated (2/3rds) by derivatives and may be driving price action intraday. But there's no real relationship between the level of FX vol on USDJPY and change in price: Now figure out your edge: Do you have an edge in trading vols and knowing dealer positioning? Or do you have an edge in predicting rate policy? Once you know what your edge is you can then build a strategy around trading it. On a trade-by-trade basis, you will look at things such as current price vs. fair value (measured on a z-score) and against the scenarios you think are embedded within price. E.g. at USDJPY 140-150+, the currency may be pricing in higher for longer US rates with JGBs trading flat. If the Fed cuts, rate differentials will compress, and USDJPY may trade at 120-140 if a soft landing occurs or USDJPY 100-120 in a hard landing where JGB trades flat. If BoJ cuts, then dollar-yen will stay within range. When you think the distance is sufficient (expected return vs. fair value) and less than the expected risk (a mix of both the sigma of price chg and the level you think the currency will move to if you're wrong), then you enter the trade (and vice versa). This is typically what a general approach to using "fundamentals" looks like.
That's all good stuff. I consider it quantitative work. For the most part I just form a fundamental thesis and narrative to support the technicals. The quantitative and technicals come first. These are the Treasury Yields curves and the stock market. I fundamentally believe that there are seasonal incentives to create the wealth effect.