Technical Vs Fundamental analysis

This is my first post in this blog . In this post I want to give my brief ideas about technical and fundamental analysis .


Today Sensex lost 372 points in a exteamly volatile session which witnessed more than 1100 points swing, But the improving global situations should bring stability to indian markets from tomorrow.


Fundamental analysis mainly deals with companies assets , liabilities , profits, growth etc etc. While technical analysis will deal with the demand and supply of the particular share.

The most confusing thing in stock market is both of these are contradictary to each other .

Fundamental analysis will tell shares will become attractive when the prices fall as they became cheap while the technical analysis will tell the shares will become attractive when the prices raise as there is more demand to the share.

Investing based on technical analysis is more risky as compared to fundamental analysis as they will change drastically and un-predictably ..

Technical analysis is more useful ( or meaningful) in trading rather than investing . While trading we should be more cautious and limit our potential losses by applying stop loss etc.

We should take any investment decision rationally , un-emotionally by considering only the fundamentals of the company rather than the price movements or technicals of the shares..

RK

Note: I have copied my previous posts from the old blog below, for the sake of continuity