I'm primarily a fundamentals investor because fundamentals tend to win out in the end or in the bigger picture, but if you think charting can not predict the future you're wrong.
Sometimes, especially in the case of highly complex chart analysis, charting is a self fulfilling prophecy; everyone thinks a price will go down so they sell, and look at that, the price goes down. Or up, or whatever the chart 'predicted'. Sometimes though, charting is a legitimate and powerful tool in a very legitimate way. If we look at what people were doing when they bought and we know how investors/traders tend to do behave, obviously we can predict what is likely to happen. Sometimes the future is very easy to predict - if I toss a coin I know it will land. Sometimes it is difficult - if I toss a coin I can't tell what side will be face up when it lands.
If you think drawing lines on charts can't predict the future you are arguing against a strategy which has made a lot of people very wealthy. Because you can't financially take advantage of stocks you can't short there is no one playing silly games, so the easiest instances of chart reading are often cases of predicting price falls in companies like AEB.
If I say a chart is ugly I mean it predicts future drops, that is, it tells me I don't want to be holding. If someone wants to pretend I am saying something other than what I am, they can enjoy their empty engineered victory if delusion makes them happy. As I keep saying, of course there are charts with greater drops, and retrospectively there are cases of stocks worse to be holding, but since there are charts which finish at zero, it doesn't take a smart man (or child) to see that argument is irrelevant and not what I'm saying.
Having said all that, I'll say again that with a small cap pie in the sky dream seller like AEB, the fundamentals can blow a chart away if their dream comes true (or if they fool people into thinking it will). I don't know why Tretchy wants to focus on itso much. The main reason I am bearish on AEB is the fundamentals. I am completely unconvinced of the economics of the project, and puzzled at strange moves such as the strategy of the current SPP. Price above market, extended due to 'market conditions', ends tomorrow, no news to improve market price! It's difficult to imagine that's pure stupidity, so I suspect they may have something interesting planned. I sort of hope they do, as I'm sure holders do too!
Not surprisingly, with no announcement the day before the SPP expirey, the depth has turned bad. The chance to sell out in decent volume above 18c seems to have gone as hope of the carrot fades.
AEB Price at posting:
19.5¢ Sentiment: Sell Disclosure: Not Held
