What About Earnings?
There is no doubt that what a company earns has a direct impact on its value. Technical analysis does not consider earnings, financial statements, news, and input prices directly. Rather, it assumes that all of that information is in the current price. A better definition is that price is the sum total to date of the actions of everyone in the marketplace. Someone was following earnings and bought or sold the stock. Somebody else was watching the news wires to find developments affecting the company. Input prices are followed by others. If the price of apples and wheat flour go up, the margins at Aunt Betty’s Fruit Pie Company will be squeezed. This is technical analysis.
In the credit markets, there is always the fundamental ...
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