Supply, demand, and human emotions my friends. This is what makes a market. As you know I talk Markets all the time and constantly looking for great companies and stories. I combine fundamentals with technicals, but technicals usually tell me the fundamentals before hand.
News drives stocks, there is no doubt about that. However there are many times that the market tips its hand, or someone knows “something” that will initiate the technical move before the fundamentals hit. One example of technicals ruling is the $AAPL selloff. While $AAPL was at $250 I said that I would not buy it u less it touched under $145ish. Why you ask? Well it’s because that is where the 200 Week MA resided and guess what? It has held 3/3 times over the last decade since the bottom.
You HAVE to give the benefit of the doubt to this and now it is 4/4. Does this work every time? No. But you have a defined entry and defined stop. I called this while $AAPL was $220+ and you can see exactly where it stopped. It kissed the entry.
For those that only use fundamental analysis, you are missing an edge my friends. We are in a world of battling human emotion and computers and the computers are programmed to play off this emotion. This is why it works.