A:

The simple answer to this question is definitely not. This form of analysis can be applied in more situations than you may think. Any time a person uses past data to predict the outcome of a future event, he or she is using technical analysis.

For example, a meteorologist can use technical analysis by taking all the temperatures for Jan 10 over the last 25 years and using the average to predict what the temperature will be like this coming Jan 10. This probably isn't the best way to forecast the temperature, but it can help to confirm predictions made by other models. Technical indicators, trends and moving averages can be used to analyze the direction of bonds, mutual funds, indexes, interest rates, exchange rates, jobless claims, housing starts and the weather. They can even be used to forecast the prices of futures such as oil, propane, gold, corn, soybeans, etc. The use of technical analysis is not limited to what we have mentioned here, but this should give you a good idea of the many things to which it can be applied.

(For more on this topic, see our Technical Analysis tutorial.)

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