 Hey everyone, welcome to another video lesson from navigationtrading.com. In this video, I want to address the question, do I need to learn fundamental and technical analysis to be successful trading? All right, so let's jump in. I am in the TD Ameritrade Thinkorswim trading platform, and I want to give you an idea of kind of my suggestion when it comes to both technical and fundamental analysis and how to use those within your trading. Now, the first thing is we're looking at a chart, and I just picked a stock, in this case Amazon, and this is how I have my chart set up. And we're starting with technical analysis here. You'll notice that my chart's pretty clean. We've just got a simple daily price chart. We do have a couple things on here. You see the pink cone here. This is simply just the expected move. And this is just about a 70%, about one standard deviation chance of how the stock will move over time on a plus or minus basis. And this just comes directly from the options. So if you go to the option chain in the platform of a stock, you'll see, let's say with June, with 24 days to expiration, you've got about a plus or minus 98 point move. So that's all this is showing is just kind of the expected move based on the volatility and the price and the time involved of what kind of the up or down move that the stock could make. Now, there's nothing that says it can't move outside that expected range. And there's nothing that says it won't be much more narrow than that expected move. All that is, is an expectation, a probability of where that stock will go. The other thing we have on here, sometimes I'll put this line here. This is just a 200 day simple moving average just to get a quick snapshot. If the stock is kind of above that or below that, do I do anything with that? Does that give me any reason to make a trade? No, it's simply for reference. And then the third thing that you'll see down here is our navigation trading implied volatility indicator. As option sellers, as option traders, we always want to know where implied volatility is versus itself over the past year. And that's all this gives us. It gives us an idea are the options expensive or cheap? If the implied volatility is low, that means that the options are cheap relative to where they've been over the last year. If the implied volatility is high above 50, that means the options are more expensive than they've been relative to the rest of the year. And so that's all that is. And here's where I stand with technical analysis. If it gives you a reason to make a trade, then that's great. That's what it should be used for. But don't for a second think that some moving average crossover or stochastic or some type of technical analysis or indicator is going to give you an edge in your trading. If you look at all the different studies that Thinkorswim has, I mean we're talking about hundreds or thousands of different indicators that are available, not to mention some of these other ones that people sell for astronomical amounts of money that don't really do anything. So there's all these different indicators and here's the thing. Everything is a lagging indicator. The only thing that's kind of forward looking is implied volatility because it's implied. It's implying what the expectation of that stock or ETF is going to do. Any of these moving averages or crossovers or stochastic, all these things are lagging data. So lots of those points after price has done a specific move or something specific has already happened. So they don't give you any edge in the market, but if they do provide an engagement, if they do provide you a reason for placing a trade, then great. That's fine as long as you still continue to be strategic and put the probabilities on your side, then I have no issue with whatever technical analysis it is that gets you engaged and gets you to place trades in the markets as long as you stay strategic with those trades. So the other piece then is fundamental analysis. And so some people claim that they are fundamental, they only trade or they only invest based on the fundamentals. And here's the problem with that. And if we go to the Analyze tab and you click on Fundamentals, you can basically get anything you need here. You get the buy hold, outperform, long recommendations from the analysts, which if you're placing trades based on those, you've got serious problems unless you're fading them, unless you're going against them would be the only thing that I would look to do when it comes to analyst ratings other than that they're pretty worthless. But if you scroll down here, you see a description of the company. You can see the different earnings per share, dividends per share, the profitability, trading profit margins, activity rates, total asset turnover. I mean, you get all the fundamental data of that specific company. And so you would think, hey, that's important, right? We want to be investing in companies that have good fundamentals. We want to look at these, the fundamentals should help us make better trades. But the reality is, everything is already priced in. So if you've read it in a newspaper, if you've read it online, if you've read it in a trading platform like you're seeing here based on this data, guess what? It's already priced in to where the stock is trading at that time. There's no edge for saying, oh, well, Amazon had all these great sales. Well, guess what? Everybody else knows that information too. So the price has already reacted within milliseconds of certain things happening. And you can see that when it comes to earnings announcements. I mean, immediately after the announcement is made, the stock reacts. So do you have time to get in? Well, I mean, you can make a bet that it's going to continue in that direction, or you can make a bet that it's going to go against that direction that happened. But trying to use fundamentals to make trading decisions, again, there's no edge. If fundamentals, certain specific criteria meet what you're trying to do and that gets you to make a trade, then that's great. But thinking that you have an edge with any kind of technical analysis or fundamental analysis is just a flawed way to trade. So I hope that was helpful. If you have any questions, let us know. If you want to check us out and what we're doing here, just go to navigationtrading.com. See you there.