We must keep in mind four assumptions about technical analysis:
Only supply and demand can influence the market value of a good or a service.
Supply and demand are themselves influenced by many rational and irrational factors.
The market weighs these factors continually and automatically.
Prices for individual securities
tend to move in trends and
persist for some period of time.
Prevailing trends change when influenced by changes in supply and demand.
These changes can be detected in the actions of the market itself.
The last two aspects are controversial among technicians and non-technicians; the first two are not.