Prawhida Surya Buana
Sekolah Tinggi Ilmu Ekonomi Madani Balikpapan

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EFFECTIVENESS OF FUNDAMENTAL AND TECHNICAL ANALYSIS TECHNIQUES IN PREDICTING STOCK MOVEMENTS: A REVIEW OF THE LITERATURE AND ITS IMPLICATIONS Hety Devita; Muhamad Eko Wahyu Umaryadi; Prawhida Surya Buana
INTERNATIONAL JOURNAL OF FINANCIAL ECONOMICS Vol. 1 No. 5 (2024): INTERNATIONAL JOURNAL OF FINANCIAL ECONOMICS (IJEFE)
Publisher : CV. Adiba Aisha Amira

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Abstract

This study aims to review the effectiveness of fundamental and technical analysis techniques in predicting stock movements and their implications for investors. Fundamental analysis focuses on a company's financial condition, business performance, and macroeconomic factors to estimate the intrinsic value of a stock, while technical analysis uses historical price and trading volume data to identify market patterns and trends. A literature review shows that each method has advantages and limitations. Fundamental analysis is more suitable for long-term investments as it provides an in-depth view of a company's growth prospects, while technical analysis is more useful in short- and medium-term decision-making due to its ability to identify trading signals based on recent market behaviour. The conclusion of this study highlights that a combination of both techniques can support a more comprehensive and effective investment strategy, by optimising portfolio performance and minimising risk under various market conditions.