Swing Trading : Is it caused by TA or Fundamental factors?

[alroyraj]

Hello friends. I want to gather your thoughts on whether Swing trading as we understand it caused by technical factors say like chart patterns or perhaps by fundamental factors like news flow or asset purchases or M&A that cause a stock re rating.

 

[praveen98]

hi Alroyraj,
Intresting question...in my opinion price swings are due to small extent of technical and to a small extent of fundamental factors..but " DUE TO LARGE EXTENT OF GREED AND FEAR":clap:

 

[alroyraj]

Stocks are usually valued to start with by fundamental analysis. Technical analysis captures the behaviour of market participants of all types traders ,investors . And based on news flow,and rumours ,market participants revalue stocks. This revaluation takes extremes due to tendency of participants to over react to information and due to the band wagon effect.

 

[veluri1967]

Low P/E attract buying even in the absence of Technical Signals. Conversely, higher P/E forces profit booking.

TA helps to find patterns in the movement of prices caused by Fundamental issues.

 

[alroyraj]

Low P/E attract buying even in the absence of Technical Signals. Conversely, higher P/E forces profit booking.

TA helps to find patterns in the movement of prices caused by Fundamental issues.

There are 2 styles of investing,the value investing philosophy where lower P/E matters and the growth investing philosophy.
In the growth investing philosophy we have shares like Asian paints,GSK Consumer,maybe LnT where the visibility of earnings is high as they belong usually to FMCG sectors. Here the P/E is always high.