WHY FUNDAMENTAL ANALYSIS IS SO DIFFICULT FOR A TRADER

I always said fundamental analysis is not require for a trader , he require good command over technical analysis , good control over emotions to be successful trader ,reason is not that fundamental analysis is bad by any mean , infect it require great amount of knowledge & than coming out with the right decision require lot of questions to be answered ,here are some of the questions ,if someone wants to make a call on any commodity with the help of fundamental analysis

1 Who holds the commodity -companies, institutions, speculators?

2 How authentic is demand supply data?

3 How open demand /supply data to interpretations?

4 Is the demand /supply picture susceptible to media magnification or speculator manipulation?

5 How well is the commodity covered/researched?

6 What kind of institutional investors buy this commod
ity –insurance companies, hedge funds, etc?

7 Is the commodity part of ETFs? Do the ETFs store the commodity?

8 Does the commodity have any substitutes?

9 What are the inventory levels?

10 What is the demand & supply situation?

11 What is the commodity used in? Is there a specific use that is consuming the incremental increase in the commodity?

12 Is the commodity supply limited by the amount available to be mined?

13 Are there any constraints in some part of the processing chain or transport chain?

14 Are there any new discoveries or talk of new discoveries?

15 News flow –the US dominates news flow but it may be
necessary to see the news flow from news media in other commodity producing countries

16 Is there any hoarding of the commodity?

17 What is the cost of production of the commodity & its relationship to its current prices?

18 What percentage of the commodity is concentrated in one country & how could any disruption impact prices?

19 Does the commodity have any correlation to another commodity? Is it found with another commodity? Is it used with another commodity? Is it part of making another commodity?

20 Which part of the world is unexplored & may contain deposits of commodity?

If you can have answers of all these questions ,providing you got the genuine data source than you make decision to buy or sell any commodity ,which again may turn out be right or wrong …….
Now it’s up to you whether wants to be fundamental analyst or technical analyst...!!!!