Investors often fall into one of two categories: fundamentalists or technical analysts. Fundamentalists rely on company fundamentals, like earnings, debt, price-to-earnings (P/E) ratio, etc. This information is typically released in a company's quarterly or annual statement. This helps an investor answer the question, "Should I invest in this company?" Many fundamentalists believe technical analysis is voodoo. Technical analysts rely on chart patterns to determine the proper time frame in which to enter and exit a trade. This helps an investor answer two of the biggest questions they likely have: 1. When should I enter a position? 2. When should I exit a position? Many technical analysts believe you don't need to know anything about the company - that everything you need to know about the stock is reflected in its chart. After more than three decades in the market, I've come to learn a secret... Fundamentals and technicals shouldn't be so polarizing - both have a place in successful investing. After all, it's not just enough to know whether you should buy a company... You also need to know when to buy and when to sell. And depending on your time horizon and investing goals, you may want to lean more heavily on fundamentals than technicals or vice versa. You see, in my Safety Net column, and in The Oxford Income Letter, I lean heavily on fundamental analysis. I look at metrics like income and cash flow to determine a company's ability to maintain its dividend, and I also study the competitive environment to gauge stocks' likelihood of rising. This is often the best way to look at a stock's viability for the medium to long term - and it's a skill I honed while working at the contrarian research firm Avalon Research Group. But when I started my career as an assistant on a trading desk, executing trades and watching the "tape" for trends, I needed to find a way to help make sense of all the data flying across my screen. Thus, I began to rely on technical analysis and chart patterns. Nowadays, I can't imagine making a trade without them. Using chart patterns is the perfect method for anticipating a stock's short-term movements. And if you can master just a few simple strategies, you can produce results that are unthinkable for most investors. | 
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