If the financial markets are efficient then technical analysis is doomed to failure. If markets react almost instantly to new information that comes in randomly and which effect (either positive or negative) cannot be predicted the graph of a stock market should be very similar to a graph of random walk. A number of studies concluded namely that people cannot tell a real stock market graph from a random walk (here) .
What is more, they also find patterns of technical analysis (head&shoulders, triangels, breakthroughs of trend lines etc.) in random walk movements. However, the random walk is by definition unpredictable – as a result, technical analysis cannot work here. But if such patterns exist in random walk graphs what if stock market is also of random nature? If this is true then technical analysts are to no purpose and could pursue another profession (which I am persuaded of).
Authors of this study (in which they claim in contrast with other studies that their sample could tell real graphs from random walk) created a game where you can test your monitoring skills – http://arora.ccs.neu.edu/v4/tool/login.jsp.. Are you able to distinguish real data from random walk successfully in the long run?