Quoting Tony WonderDislikedSimply put technical analysis works because we use it!
Yes it is something made up out of humans inherit need to understand and simplify things that can not be understood easily.
100 years ago trading the stock market technically would have been close to impossible. 30 years ago technical analysts were laughed and thought to be crazy. Today just about every trader in the world uses some form of analysis.
Yes humans to have a need to make a pattern out of everything and to simplify the most complex thing. Easy is one of the most powerful words in the English language. We want everything to be easy and technical analysis simplifies a complex market it brings it all down to a few lines.
Are those lines useful? Yes they are useful because of humans inherit need to simplify everything in life.
They are useful because however many years ago thousands of people bought into the idea of an easier way to trade forex. They are going to continue to grow more and more useful as thousands upon thousands of new traders come into this market every week all using technical analysis.
The fact is tech analysis is slowly becoming more powerful than fundamental analysis and soon fundamental analysis will become useless. When we get 100,000 new retail traders next year and 200,000 the year after most of which using tech analysis fundamentals will become obsolete. I see it myself the central banks are losing their grip on the market they do not have as much effect as they use to.
It's human nature we like to simplify things we had ovens we made microwaves we had bikes we made cars.
What it all comes down to is technical analysis if used right is the most effective way if predicting market movement.Ignored