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Q: Tehcnical Analysis versus Fundamental Analysis ( No Answer,   2 Comments )
Question  
Subject: Tehcnical Analysis versus Fundamental Analysis
Category: Business and Money > Finance
Asked by: rammu79-ga
List Price: $2.00
Posted: 01 Nov 2004 10:56 PST
Expires: 01 Dec 2004 10:56 PST
Question ID: 423004
I want to know whether there are concrete examples of stocks in which
a much higher rate of return would have been obtained by using
technical analysis-instead of fundamnetal analysis
EG: When Short Covering takes place even a dud stock has a temporary rally
Are there other specific instances like this where tehnical factors
outweigh fundamental factors
Please give me examples of stocks in which this has happened
Answer  
There is no answer at this time.

Comments  
Subject: Re: Tehcnical Analysis versus Fundamental Analysis
From: dr_bob-ga on 02 Nov 2004 09:41 PST
 
Over the long haul fundamentals always outweigh technical factors. 
ALWAYS.  If a company is worthless, whether or not the paper is
oversold is irrelevant.

Now, there are plenty of examples where technical analysis has
outweighed fundamental analysis over the short term.

Look at the stock charts for:

TASR
KKD
AMZN

Now lets look at the dead and buried DOT-COM's. These were all turd
companies with no intrinsic value, just pipe dreams and hot air. 
Aside from some buttwipe analyst's metric for valuation, what metric
would you apply? You can analyze the size of a potential market, but
until a product exists and you have a buyer, is there really a market?
So what metric do you apply?

As a result, when there is no real metric, and a short supply of
stock, technical factors can easily detect an outstrip of demand for a
stock. Thus the idiocy with stocks like KKD, and TASR which trade at
insane multiples.

If you can find the stories, you can be successful by looking at where
a stock is headed, when it has topped out, and knowing what the real
value is.


Bob
Subject: Re: Tehcnical Analysis versus Fundamental Analysis
From: exotic_options-ga on 03 Nov 2004 06:31 PST
 
Fundamental Analysis is a Lagging Indicator whereas Technical Analysis
is a Market Indicator. For Example: Hindustan Lever is a Great
Company. I don?t think anyone disputes that. Hindustan Lever was
trading around Rs.182 on 19th February 2004 when it broke its Long
Term Moving Averages. This is a Indication about weakness in the
Stock. But there was no news from the Company for such a Bearish view
of the Stock. Only when the stock had come down to 140 levels (I have
forgotten exact rate) was the news that P&G had cut the Price of its
main line detergent brands and HLL would follow the same. This in-turn
would impact the Gross Margins / Profit Margins of  the Company. Again
over the last few weeks, HLL has outperformed the market, but its only
yesterday (17th September 204) that news has come in of P&G and HLL
raising prices of Detergents sold in Sachets.

The above example clearly shows that using Technical Analysis is the
best way of Analyzing stocks for Investments into them. After all, we
Invest in a Company to make profits on our Investments.

The above example is of a Indian Company - Hindustan Lever Limited
which inturn is a subsidiary company of Unilever.

Yahoo Code for HLL : HLL.BO

Hope this helps.

Regards

XO

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