FA, TA and finally PA

[chump]

OK,
Fundamental analysis...accounting basis..says this is what a fair value price is for any can of beans ...

Technical analysis....2000 different patterns..sunspots ....waves....angles ad infinutum

now let's talk about psychology..and I don't mean your personal psychology...I mean Psychological analysis....knowing how FA and TA behave what do we expect them to do when a financial instrument hits significant points in their terms of reference and how do we get in their pockets

Here's a little starter with an overview to get going with

 

[RUDEBOY]

O.K. What is the 'lagging' analysis? Because fundamental value should always hit the mark first?

Sorry Chump, got the wrong end of the stick. Did you mean, who makes the first move 'fundamentaly"?

That is a good question. Looking at fundamentals, is there an obvious point of 'entry'? Or is this just down to 'speculation"?

Fundamentalists have thier own battle it seems?

 

[chump]

Rude,
I don't think it is necessarily a case of FA being first as such and in fact it does not matter as far as the end result is concerned..for myself I look at it this way....FA tries to analyse the what content of value and TA attempts to analyse the when aspect to value and timing...however bear in mind this...most people get it wrong ,if they didn't the market would not behave the way it does ,that is it would just be more one directional (trending for most of the time and we know this is not true) , and both FA and TA are caught in that argument..so we want to know their primary terms of reference ..their tools ,..because if they are wrong we want to know the significant points that will tell us when they also realise they are wrong..this gives us the ability to be in their pocket at that moment.....bear in mind you do not win by accurately anticipating fair value...you do not win by correctly anticipating when fair value will be caught by the market...you win by banking the money when the majority of people get these expectations wrong and react to that outcome ....this is a psychological numbers game...

I am hoping this thread get's little response ,because that will tell me the majority are not going to change the way they trade ...know what I mean

 

[chump]

Ideally I'd like to see out of any 100 members about 33 thronging the mechanical systems forum ,33 thronging the techicals forum and about 33 arguing the toss over fundamentals which leaves...oh my gosh I'm talking to myself ..but ,heck I don't mind who's money I take

 

[chump]

LOL..looks like I got my wish

 

[dbphoenix]

Like you say, I doubt many people here would really see things this way, but that suits me fine.

GJ

Ditto . . .

 

[dbphoenix]

DBP

I guess you might fall into the group of people I described at the top that favour expressing this stance by trading on price alone.

Hopefully in a roundabout way we all arrive at the same happy place.

There does seem to be that perception, even though I've said repeatedly that I trade fear (it all comes down eventually to fear). Trading "price" means trading without indicators, not trading without regard for fundamentals or context.

But arguing about this stuff takes too much energy, energy that is put to better use in finding and managing trades. Since I've posted here, of course, this will likely not remain a quiet thread. But perhaps you and chump can carry on without me

--Db

 

[chump]

Discovered at last ...LOL...

OK, then I'll offer a little bit more and see what comments come along....

If the idea that profit is the sole motivator holds ( ) then consider this when a significant (defined in term of tools of TA / FA etc) point is in sight ...what does the notion of line of least resistance have to do with what comes next ? ...I'm not talking about regression here per se ..I'm talking about the psychological tendency that human behaviour has of seeking the line of least resistance to go from point A to B ...let's think about that behaviour within the context of how it can be used together with transparency and again think about transparency inside the bigger picture posted at the top of this thread.....where and how does transparency allow us go from point A to point B with the least resistance ?

Thanks Gamma .....wouldn't mind seeing your bank balance ....LOL