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Technical analysis is a method of evaluating securities by analyzing their past price movements and trading volumes. It is based on the idea that market prices reflect all available information and that price patterns and trends repeat themselves over time. Technical analysts use various tools and techniques, such as charts, indicators, and patterns, to identify potential trading opportunities.
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This fractal property has enormous implications for traders. It means that a price pattern visible on a 1-hour chart may also appear on a 5-minute chart or a weekly chart. The difference lies not in the type of pattern but in the significance of the information. Shannon uses the analogy of a Van Gogh painting:
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