Fundamentals vs charting (statistical)

[stueytrader]

Just wondered what peoples takes and/or use of both these aspects of trading were?

I'm implicitly rather a 'fundamentals' type of trader, possibly coming from punting in my earlier horse racing 'career'. I can't help but analyse the previous runs, form, trainers and jockeys etc in order to understand a market.

However, I understand others prefer to look at the market and prices in a cold way - based on movements, prices, previous forms of move in charting etc.

Be interested to know how much all types of traders (experienced/intermediate/novice) look at these approaches, and also can both be used in a successful strategy overall?

Cheers and GL,
Stu.

[Dallas]

Im most definetly a cold trader and do no form searching what so ever, i dont even have the volume on for tv pic so i can ignore any pundit commentry or views, im only watching for visual signs of how a horse/s is behaving just as am only watching the market on screen.

The only time i do look at 'form' is when looking for any in-running back 2 lays

[stueytrader]

Im most definetly a cold trader and do no form searching what so ever, i dont even have the volume on for tv pic so i can ignore any pundit commentry or views, im only watching for visual signs of how a horse/s is behaving just as am only watching the market on screen.

The only time i do look at 'form' is when looking for any in-running back 2 lays

That's interesting, thanks Dallas - you actually fit into the category of trader that I find rather a mystery personally! I just find it really difficult to understand how the market is likely to react without the form element, as I assume that those putting money in will often be using form as a guide for their money (this may be wrong of course).

But your own take is different I presume?

[jimibt]

Im most definetly a cold trader and do no form searching what so ever, i dont even have the volume on for tv pic so i can ignore any pundit commentry or views, im only watching for visual signs of how a horse/s is behaving just as am only watching the market on screen.

The only time i do look at 'form' is when looking for any in-running back 2 lays

That's interesting, thanks Dallas - you actually fit into the category of trader that I find rather a mystery personally! I just find it really difficult to understand how the market is likely to react without the form element, as I assume that those putting money in will often be using form as a guide for their money (this may be wrong of course).

But your own take is different I presume?

i think the mystery part is less smoke and mirrors than you imagine (not saying I have any real credible grasp on this in any way, however...). my observations to the market moves have all been guided by the principle that the market is a self regulating mechanism and therefore you have a containment element. if one price (or set of prices) go up, others naturally must go down (to keep the book% in check). thus, you can look at this technical level and develop either an eye (or a software component) to both model this process and exploit any movements going either way.

in practice, this is of course far more difficult than explained above, otherwise everyone would be doing it

[stueytrader]

Yes, suppose that's true jimibt - plus you also have to factor that if traders are playing that way then each of their own trades alters the market in some way too. Complexity!

I must say, I can understand the purely mechanical/stats way to view a market and it's moves, but I can't bring myself to ignore the fundamentals that are the basis for some of those moves.

Perhaps the best way to summarise how I see it is that ultimately the market does have to represent an image of the actual race (otherwise Frankel would be 100/1 etc)