If the market is efficient as they claim, and everything is baked into the price, shouldnt price be the only thing you have to monitor?
Fundamentals are no different than TA, enough traders believe a symbol should go up and they have volume to do so, it will. Every trade is a prediction of price going their way. The only correct prediction every time is death at end of life. There are some good repeating fundamental news that work more times than fail, but if large traders not into direction, not going to be profitable. TA is easier to automate.
I believe their argument is that price has all available information at any time so it has no predictive value. There are Buffett types who believe TA is worthless but fundamental/value analysis can give you an edge. If anything, I think fundamental analysis is even less valuable now that everyone can see a stock's earnings, financial statements, etc. in a split second. Back in the day guys like Buffett pored over that kind of stuff all day in books and periodicals as most people with day jobs didn't have the time or money for that kind of research. I will say that mean reversion happens everywhere, so value stocks (which have underperformed growth stocks for many years) are finally doing better. But no one knows when this starts happening or when it will end, so fundamental analysis isn't going to tell you when value stocks will start outperforming the broader market.
Hello Ivano, Let us just focus on ourselves making millions of dollars in the trading game. Jim Simon will never help us.
When money pumps a stock, it rises, when they sell in, it falls. Right now, big money is dumping inventory, the best play for them in a market with no buyers (bear). They do one-day pumps, sell all out for that day and the next, then let it fall, fall, fall, then leave it alone, and work another. Nothing to do with technicals, they P&D what they have in inventory. Unless you know what cards they have, TA does nothing. The Dow rises and falls by thousands, though the "fundamentals" of the companies in it remain the same within the same period of days. Quick buys on low volume, a tickers' price jumps, quick sell on low volume, it falls big. Accumulate, release profits, accumulate, release profits. Humans decide when and where, not technicals or "value." The entire market, the whole game, is 100% based on fear, a human emotion.
I know that I am facing a religion and most acolytes will insult me inmediately when they see a contrarían opinion. It is interesting to see that even some of them will not include indicators as part of technical analysis, it gets to that point. There are factions in the cult. Let me add that we are running 9 pages of comments and not a single one has proven that TA works, which was the initial point of the thread.
Um it depends on what you are looking at. Surely the past performance of a jet liner flying 100 people from Miami to Chicago would have some predictive power that would induce you to climb aboard and fly back to Miami or you would’t crawl on the contraption. It’s past performance proved it could fly therefore you would reason it would likely be able fly back to Miami.
Hello TazTheLaz, Does Technical Analysis or Price Action makes money consistently year after year for +XX years for manual or automated traders? The answer is NO. Why the answer is NO, because I never seen hard evidence of TA making money for any trader year after year for like 3 years. I think you see from the 9 pages of threads so far no proof of it working. However, I try to trade it manually because its all I know. Only time will tell. So far, I been consistently profitable for about 2 months now everyday. But 2 months is nothing. Check back with me in 1 year to see my results. If you would like to see these results of my trades with TA, just respond and ask me, and I show you
Honestly, with listed and securitized vol, TA is less informative, generally. A lot of the legacy supply and demand price formations just don't occur anymore (Wyckoff stuff). However, most of it boils down to a couple ideas. A market is moving either too fast or too much, can't sustain its current level, is about to flip and trap the herd, or is coping with liquidity constraints. Liquidity-at-price is a real fucking thing, and margin is not free. TA just gives ideas like FOMO and fear a numerical representation. VWAP is rock solid, and if you don't know that then you've been living in a fucking cave.