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| If you talk to most commodity/futures brokers they'll tell you, you need to concern yourself with both the fundamentals and the technicals/charts.
Markets often go contrary to the fundamentals.
Fundamentals can make you stubborn--"this market has to do such and such"--and you hang-on and lose a bundle.
The markets often "discount" the fundamentals--that is, they price-in the fundamentals ahead of the fact.
The fundamentals often look best at tops and worst at bottoms.
One successful futures trader called the fundamentals "the funnymentals." I think he's right.
It is "human nature" to want to make sense of the markets. I think this trait often works against most people trading the markets.
I think acquiring a "trader's psychology" -- which includes tons of self-discipline-- along with a few viable entry/exit signals (there are no perfect signals so be ready to exit with small loss) is the very difficult to achieve answer to success with the markets.
Of course all of this applies to both farmers marketing their crops as well as traders.
The market is reality, the market is the boss and fundamentals often put you at odds with the market.
I recall the last super bull move in the stock market. Many writers were saying the top was near FOR YEARS! Some analysts would say, "The market likes to climb a wall of worry." That is, keep going up regardless of the bad news.
Tricky stuff, these markets.
Don McCullough | |
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Problem(s) with the"fundamentals."
