How to get rich(3) : Gamblers beware - on Technical Analysis and Forex

For past tips , please see here for how to use float, and here to understand the risk and return characteristic of investment products.

What is [ technical analysis] ?

Taking from wikipedia, 
" Technical analysis is a security analysis discipline used for forecasting the direction of prices through the study of past market data, primarily price and volume." 

In short, by trying to predict what the market will go next through current price and volume information, people are trying to [ act ahead ] of the market and taking profit from it.  Technical analysis is easy to learn, and can be apply to virtually any market which price and trading volume can be charted. There are so many experts that claim themself have been successful in technical analysis, that they can win big utilizing relatively small market daily price movement through the use of leverage. There is, however, one question that investors ask themself, if trading in currency exchange market using technical analysis is so successful, and everyone taking the same strategy, where is the winner's money came from? 

Unlike [ Stock Market ] ,  holding currency in a foreign exchange market will not generate cash flow over time. The only return you can get, is by buying low and selling high. But in foreign exchange market, every buyer must be matched by every seller. This mean that if one's is making money at this moment, someone else must be loosing money at corner somewhere around the world. One can easily related the trading in foreign exchange market as gambling in a casino. 

One would wonder, if the overall wealth of all the participant won't increase in a foreign exchange market, why would the brokerage firm like FOREX so keen on encouraging others to take part, and even providing free chips for them to start?  The answer is very obvious. Company like FOREX gain through the tiny amount of transaction fees they charged, hence the more you trade, the more they gain. 

What about those financial gurus that claimed to have [secret recipe] for successful trading? 

Well, think of all the gamblers in a casino each have different way in predicting whether the ball in a roulette game will fall on red or black square. Overtime , there must be someone that are lucky to predict accurately at 70/80% of the time. Now, the one who might be just lucky can sell whatever formula he have based on his past records. While the buyers seldom realized that, in a casino game, success can't be replicated. If there is one winner who success by trying the formula, there would be more people who end up loosing, and their failure will be attributed to their inability to master the trading formula...