Now the question is if the market continued to go higher, fundamental doesn’t look good, do you want to stay out and miss totally miss the run because reality is there will be market bubbles they will be market crash right, so during a market bubble usually the value will be much more lower than the price where is running to.
So if you because if you just look at the fundamentals and you decide it oh the market looks over value and then a market keep on going higher and higher and higher and higher and you didn’t participate, do you realize there’s a opportunity cost?
So that’s the reason why technical analysis and this, in my opinion, allows you not just to get in a trade at the most optimal time possible, it also allows you a more discipline way not to miss the big move that the market is wanting to give, wanting to push.
If you just look at fundamentals, the fundamentals don’t tell you how the market participants are thinking right and one of the best tools for trader is that use whatever tool that helps you understand better how the market is thinking.
Maybe in the future there are some other tools that can give you a very clear picture of how the market participants are thinking, that would be the kind of tool I want to use because prices move because of market participants.
It doesn’t move because of fundamentals.
Part of the participants could make a decision because of the fundamentals but market doesn’t move because of fundamentals.
Moves because of people.
So use whatever tool that helps you understand the people are participating in the market and at this point in time, technical analysis is possibly the nearest to, the closest tool that can help us understand the market participants behavior and that’s the reason why I prefer to use TA. FA I use it more for supplement if I really have to.
Interested to receive mentorship opportunities like this with Philip?
Find out more at traderwave.com/innercircle
Latest posts by Philip Teo (see all)
- How can I prevent myself from over-analyizing a trade setup - May 23, 2019
- The importance of exercising patience as a proficient trader - May 21, 2019
- How much capital base should I start trading with - May 16, 2019