technical analysis 2

If prices are based on investor expectations, then knowing what a security should sell for becomes less important than knowing what other investors expect it to sell for. That's not say that knowing what a security should sell for isn't important-it is. But there is usually a fairly strong consensus of a stock's future earnings that the average investor cannot disprove. Technical analysis is the process of analyzing securities' prices in an effort to determine probable future prices. This is done by comparing current price action with comparable historical price action to predict a reasonable outcome.