The Unrecognized Death of Fundamental Analysis
THE UNRECOGNIZED DEATH OF FUNDAMENTAL ANALYSIS
Pausing to look around at the world and it’s markets what do we observe?
Disruption in supply and demand expectations is a big cause of concern everywhere, but, that’s because, in my opinion, the old fundamentals no longer are usable to track the markets and prices.
SUPPLY & DEMAND IS NO LONGER AT WORK IN MANY MARKETS
The new movie ‘The Big Short’ about the 2007-2008 bubble in the housing market illustrates this in spades. Derivatives no longer tracked the fundamental instruments they were tied to and most investors were burned from that shock treatment.
Now, that same disconnect has extended itself to ALL markets and instruments; stocks, commodities, bonds, indexes, forex and more.
One example: We’ve seen vast demand for Gold & Silver leading to lower prices, not higher.
As these two have been the basis for ‘real’ money for hundreds of years, something odd has occurred within the financial system as these would be impossible results based on the ‘old’ theory of economics. And, yet, it’s the ‘reality’ we’re faced with.
Therefore, there’s obviously a new ‘economic system’ at work for pricing and no one has given us the memo or told us when it was implemented, never mind the rules it runs by.
Changing the rules, like horses in ‘mid-stream’ is not to our benefit and just one of the tactics used to gain advantage over players in a game and keeping those rules secret as well seems to be exactly what we’re facing here.
SELECT FORMS OF TECHNICAL ANALYSIS ARE ALIVE AND PERFORMING BRILLIANTLY!
As supply and demand may now be disconnected at will by banks and institutions, the theory of markets based on fundamentals is no longer operable and we have to discard fundamentals as a means of analysis in order to protect our financial assets.
There have been traditionally only two means of analysis for the markets: Technical and Fundamental.
We’re no longer running under an ‘economic system’ where fundamentals work, only seemingly skewed price strategies (the new ‘Normal’) conducted by large banking & institutional players.
Because of this, there’s been a new level of hesitation in investment by those whose only tools before were fundamental-based analyses of inventory, demand and auction-priced markets based upon them.
OUR NEW REALITY CHECK
We now must employ the finest Technical Analysis available in order to discern the actual ‘intentions’ for the markets we examine as all other forms of ‘news’ is fundamental in nature and, under our new economic rules, unreliable as an investment tool.
Further proof of this is supplied by examining the years of fundamental reasons for ‘buying’ Gold and Silver.
All of this ‘news’ seemed rational and, if true, would surely have led to the expected sharp rise in these metals (IF, only if, the connection between production and price was operating under the previous old model of supply & demand).
But, for Gold & Silver, this simply didn’t happen. Instead, startled commentators and analysts just re-issued their reasons for continued buying all the long way down for the last 4 years.
They never came to the realization that the very rules of supply and demand themselves (which all their models were based on) had changed, and with it those changes, all their timing predictions that were made using fundamentals would no longer work.
All accuracy under the old Fundamental rules of analysis had vanished without any notice given of the changing tide of the markets.
THE MARKET-MAKERS TRY TO, BUT, THEY CANNOT HIDE THEIR INTENTIONS
Even manipulated prices will, at critical moments, reflect the true intentions of the controllers of that particular market to take it up, down or sideways. Those intentions create or manifest on our price charts as trends based upon the private formulas of the market-makers.
The market-makers won’t tell you those formulas, but, they can be discerned by examining their price structures in the light of certain presently unfollowed-by-the-public mathematical laws.
THIS KNOWLEDGE IS THE ‘INSURANCE’ YOU NEED TO PROFIT FROM THESE ‘GAMED’ MARKETS!
It’s odd isn’t it?
People will pay thousands of dollars every year for health insurance but, seldom consider the importance of purchasing the equivalent ‘financial wealth insurance’ for themselves.
A distinct advantage over other types of conventional insurance is that a well-researched technique is purchased just once and will then serve you the rest of your life and the lives of your descendants and theirs (for all who are wise enough to value and use it).
There are several distinct technical analysis courses of this very caliber which I’ve developed over the last 45-years which I’m now willing to share with those few investors and traders who are determined to win in the markets in spite of it’s rule changes.