Do fundamentals matter ?

new_trader

Legendary member
6,539 1,418
Should you consider fundamentals when day /swing trading ?

IMO: Fundamentals are completely irrelevant for day trading...I would even go further and say it is utterly ridiculous to try and use fundamentals if you are only trading short term moves.
 

tomorton

Legendary member
8,138 1,226
On the longer-term it is the fundamentals which drive the market direction and pace. But all the essential detail is in the price.
 
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attila low

Active member
152 4
IMO: Fundamentals are completely irrelevant for day trading...I would even go further and say it is utterly ridiculous to try and use fundamentals if you are only trading short term moves.
what about general market conditions like the current situation?
 

FXX

Experienced member
1,213 231
IMO: Fundamentals are completely irrelevant for day trading...I would even go further and say it is utterly ridiculous to try and use fundamentals if you are only trading short term moves.
I trade fundamentals for short term moves. Important economic releases, central bank communications, or major news events all provide ample short term volatility to profit. I am not referring to blindly trading these but through economic analysis and monetary policy analysis, its a very profitable strategy.
 

Akinozragore

Active member
123 8
Of course it is, because any information can be useful if you understand how you can use it further. Actually, a lot depends on how you feel about your knowledge and how you use it in your work. I know some traders who have a good understanding of the market in theory, but who absolutely do not understand what you can really do. So you really need to immerse yourself in the market and only in this case you will be able to use the market for your purposes and only in this case you will be able to earn. So do not worry about it, but develop more and spend time to become a more productive trader every day.
 

attila low

Active member
152 4
Of course it is, because any information can be useful if you understand how you can use it further. Actually, a lot depends on how you feel about your knowledge and how you use it in your work. I know some traders who have a good understanding of the market in theory, but who absolutely do not understand what you can really do. So you really need to immerse yourself in the market and only in this case you will be able to use the market for your purposes and only in this case you will be able to earn. So do not worry about it, but develop more and spend time to become a more productive trader every day.
when your holding positions only for a few days fundamentals rarely change , (excluding press , earnings etc..) so why bother with it too much , as it would be incorporated in the price anyway
 

FXX

Experienced member
1,213 231
when your holding positions only for a few days fundamentals rarely change , (excluding press , earnings etc..) so why bother with it too much , as it would be incorporated in the price anyway
stocks maybe but not fx where each day new information is being made available either through economic data or central banks
 

new_trader

Legendary member
6,539 1,418
The fundamentals of a country don't change on a day to day basis based on 'NEWS' releases or the rhetoric of Central Bankers.

Total US debt is $ 23,223,813 Million (Over 23 Trillion). Do you honestly think the fundamentals have changed if next week it is $23,243,813 Million?

US GDP: $21,215.7 Billion. Do you think the fundamentals have changed if tomorrow it is $21,315.7 Billion?

Effective Federal Funds Rate is 0.08% (practically zero). Do you think the fundamentals have changed if the FED says they may cut interest rates to 0.05%?

Anybody who trades economic releases or Central Bank statements is not trading Fundamentals, they are trading the 'NEWS'.
 

FXX

Experienced member
1,213 231
of course fundamentals change. Every day additional information is made available about the progress of an aspect of an economy. Central banks might meet once a month (varied by bank) to decide on policy but leading into that event are policymaker speeches which offers sentiment to upcoming adjustments. Each data point is a pice that contributes to the overall picture. A trend develops as the data materialises and it is evident by the releases shown on this chart (randomly selected), that legs in a trend are initiated from new information.
Screenshot_20200729_170813_com.tradingview.tradingviewapp.jpg



the fact you are mentioning debt really just shows a naive perception of what is going on because debt isn't really something the market reacts to not unless it is in focus. Gdp is a lagging indicator and merely reflects what happened, it doesn't offer any insight into future trends.

as for the rates, we'll all central banks are cutting and the picture has shifted more towards economic data than monetary policy. Everyone knows rates aren't moving up, nobody expects a change. The focus is not on policy now it is on economic recovery and central banks react to data so everyone is watching the incoming data.

to say that trading economic releases or central bank statements is not trading fundamentals is naive. How do you think trading plans are formed because without understanding what the data means, you are merely guessing and that's gambling not trading.
perhaps you should stick to a subject you know better because by the examples you have given and your reasoning it is clear you don't know what you are talking about.


The fundamentals of a country don't change on a day to day basis based on 'NEWS' releases or the rhetoric of Central Bankers.

Total US debt is $ 23,223,813 Million (Over 23 Trillion). Do you honestly think the fundamentals have changed if next week it is $23,243,813 Million?

US GDP: $21,215.7 Billion. Do you think the fundamentals have changed if tomorrow it is $21,315.7 Billion?

Effective Federal Funds Rate is 0.08% (practically zero). Do you think the fundamentals have changed if the FED says they may cut interest rates to 0.05%?

Anybody who trades economic releases or Central Bank statements is not trading Fundamentals, they are trading the 'NEWS'.
 
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FXX

Experienced member
1,213 231
Yes, your're right. I have only been doing 'this' for over 25 years.
clearly you have only focus on one aspect of
Yes, your're right. I have only been doing 'this' for over 25 years.
Yes, your're right. I have only been doing 'this' for over 25 years.

25 years of doing what you do has made you opinionated, with said opinions being a million miles from reality. its okay, I understand, you believe nothing else works, so anything else receives little attention. This is evident by your examples of fundamentals.

Assumptions are quick exits for lazy minds that like to graze out in the fields without bother
 

FXX

Experienced member
1,213 231
@new_trader

since I can't reply to your thread I shall reply here

just so everyone is on the same page, you are telling people to ignore anyone who trades fundamentals because they don't know what they are talking about. while you are at it @new_trader, would you care to elaborate how this example of a fundamental trader, has made over 600% over 4. 5 years, reflects someone who doesn't know what they are talking about?


if you prefer greater risk than the 7% drawdown, then I can show you a 1000+% gain example for a 7 year account that has a 31% drawdown.



it seems as though you are directing your agenda at me, I only say this because a smart person, who feels the need to brag about a winning trade in a manner that describes astutenes, will not be so foolish as to generalise an entire category of trader like you have. So once more, please explain to the same audience how these examples that contradicts your statement, and ironically your attempt at being shrewd. Maybe they are fairy dust, or from the matrix.
 

attila low

Active member
152 4
@new_trader

since I can't reply to your thread I shall reply here

just so everyone is on the same page, you are telling people to ignore anyone who trades fundamentals because they don't know what they are talking about. while you are at it @new_trader, would you care to elaborate how this example of a fundamental trader, has made over 600% over 4. 5 years, reflects someone who doesn't know what they are talking about?


if you prefer greater risk than the 7% drawdown, then I can show you a 1000+% gain example for a 7 year account that has a 31% drawdown.



it seems as though you are directing your agenda at me, I only say this because a smart person, who feels the need to brag about a winning trade in a manner that describes astutenes, will not be so foolish as to generalise an entire category of trader like you have. So once more, please explain to the same audience how these examples that contradicts your statement, and ironically your attempt at being shrewd. Maybe they are fairy dust, or from the matrix.
woah 1000% return that porn for a newbie like me !
 

FXX

Experienced member
1,213 231
woah 1000% return that porn for a newbie like me !


but according to @new_trader, traders using fundamentals don't know what they are talking about. if I were to show my account here he'd shut his mouth but I won't lower myself to his level. I bet his response will be more of the same BS ignoring the obvious. Maybe I shall post a dozen more accounts just to rub salt into his ego.

I have been building indices that track fundamentals, economic data and central bank statements, minutes, speeches. There is no price inputs to these indices its all an algo based on fundamental data. The correlations with movements in price will be like fariy dust to @new_trader and he will likely try taint it as false because he clearly can't comprehend success in this category.

In my professional career in the past, I have worked for hedge funds and investment banks. All of them use fundamentals in addition to using models to interpret risk like vol surface, IR risk, nonlinear vol surface and more. I worked closely with the traders and analysts so know first hand how they all worked and yet, according to @new_trader, even these professional institutional traders don't know what they are talking about. It's also rather hilarious given terminals like bloomberg and eikon exist as they have billion dollar investments in tech and people that focuses on fundamentals which includes news and economic data and related indices. I also worked at Reuters in their markets division for 8 years which includes work on the eikon terminal.

I currently consult for Stoxx who build manage thousands of indices including dax, euro stoxx 50, 100, 600. They have indices dedicated to fundamentals like their ESG indices family offering. Behind these indices is Sustain Analytics data which is 100 percent fundamentals for companies. They also have Reuters database with fundamentals called QA Direct which costs them about 300k a year. its hilarious listening to these home traders who think they know what they are talking about and making bold uninformed claims about a subject they know nothing about.
 
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