Why I like Technical Trading and respect Fundamental Analysis

This topic may be important to every one, hence I thought I should give it a start.

Personally my experience is that, if i want to get serious about the Sri Lankan Stock market, the most important thing to know is fundamentals of a company. For me it is really important. However knowing only Fundamentals did not help me when I was buying and selling stocks. As my experience spans more than 20 years, and from the early part of '90s we were trying to spot the right combination to buy and sell without getting caught in the middle. I can remember in the late 90's I was given a piece of paper with an article on moving averages. I found that there was something in it which will allow me to buy and sell according to the price movements. But I had to personally write the open, high. low, close, as the CSE was not providing that info, They started it from early 2000's. Since it was a big and a messy project I gave up after a while. But today it is not like that. Since we did not have technicals those days, we had 3 main things to buy and sell. They were fundamental Analysis, Media, and RUMOURS. As such the moment technicals were available in Sri Lanka and I managed to get the software thanks to the brokers who gave on line trading, I fell immediately attached to it. Now every day is a learning day for me on technicals. I think year on year the level of knowledge I gain about it is on the rise. Also day by day the number of people who gets in to it is increasing as well. That's great.

Here is why I like Technicals, as a person who respect Fundamental Analysis.

1. It gives me independence - my chart is my friend. So I don't care what the rumours or media or any other will say. That has never helped me as much as what the charts have helped me.

2. Prices and volumes tell it all. Market is always right. The reason is that any time some one gets to know something about the market or a stock. Then that reason is reflected in the price and the volume. So the market is like the big ocean, like every drop water flows to the ocean, every bit of news good or bad flows into the market in the form of price and volume.

3. Trend can be identified. As I increase my knowledge, identifying the trend is easy. Which helps me to trade or invest with confidence.

4. Helps me know why I should sell or Buy. Based on trend analysis I can decide on the Buy or Sell price.

5. My faith and Confidence increases. As such my interest in the Stock market enhances.

To some it up, the knowledge and the importance of Fundamental Analysis takes to a higher level, by expanding the knowledge and practice of Technical Analysis.