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Subject:  Re: Poll: Technical Analysis Date:  5/14/2013  11:24 AM
Author:  MDCigan Number:  17107 of 23030

It doesn't seem logical to think of TA as a subset of FA, in my opinion, and I have never seen any credible source where it is thought of this way. Can anyone find one? You get to choose which you do, or you can do both, but you don't get to choose what the words mean.

You are correct DTM. TA is not a subset of FA. It makes no sense to think of it that way. TA is about analyzing the supply/demand FOR THE SECURITY, not analyzing the valuation of the business or fundamental factors like sales, margins, cash flows

That said, a more nuanced and IMO often accurate view is that TA is a LEADING indicator of fundamentals. The thought process is that the price action reflects all markets participants of the fundamentals and includes people who know things/have better information than you. Here is a good example

I wrote about Tesla (TSLA) on April 4th, the blog post was entitled, "Tesla: Earnings, Smernings!" At the time, the stock was up 31% YTD and was hitting a new high. It had bullish cup-with-handle and inverse head-and-shoulders formations, a powerful duo. I wrote then, "Tesla is expected to earn a profit in FY2013, so as per usual price i