I “see” the market through the lens of four primary metrics: fundamentals, technical, structural and psychology.
When viewed in isolation, each of those approaches has inherent flaws.
1. Fundamentals are best at the top and worst near a low.
2. Technical indicators often trigger buy signals higher, on breakouts, and sell signals lower, after a stock has broken down.
3. Structural factors — debt, derivatives and currency effects — can self-sustain in a cumulative manner until such time they overwhelm the system.
4. Psychology, such social mood and risk appetites, can gain momentum until they snap under the weight of the herd mentality.