Adherents of technical analysis have no place in this pleasant world, devoid of the twin pillars of greed and fear. So quants often shun the study of price charts and relegate it to the status of voodoo and witchcraft. While TA slowly colonizes this Wall Street mentality, it will always remain the less traveled path. But its phenomenal power to accurately predict market movement ensures its longevity. The vast majority of destabilizing and supportive market energies remain hidden from individual traders and investors.
Insiders quietly manipulate news to protect option positions.
Analysts push stocks so their trading departments can unload inventory. Operating failures pass through accounting magic and disappear. Pattern analysis begins with the simple observation that all market activity reflects itself in the fractal properties of price and volume. As you may have guessed, this complex mandala is also known as a price chart. And the patterns they weave often contain almost mystical power for price prediction.