In an efficient market, technical analysis cannot earn abnormal returns. Technical strategies are inferior to a buy and hold strategy since they typically churn investor accounts. Nonetheless, technical analysis appears to thrive. The purpose of this paper is to explain why technical analysis...

In an efficient market, technical analysis cannot earn abnormal returns. Technical strategies are inferior to a buy and hold strategy since they typically churn investor accounts. Nonetheless, technical analysis appears to thrive. The purpose of this paper is to explain why technical analysis...