How effective is technical analysis?

Investors can use technical analysis indicators in their
strategies to get returns above the market level and turn market
trends to their advantage to maximise profits. Intercapital Invest
and ZF have tested several investment strategies using the simplest
such indicator, namely the moving average, and results are
surprising at first sight. A closer look, though, shows such a
strategy has its limitations, as well. An investor that would have
bought SIF Oltenia stock at the time of the listing (November 1st,
1999) and would have applied such a strategy would have
theoretically stood to gain around 30,200%, according to ZF
calculations. Against an initial investment of 1,000 RON, his or
her portfolio would have been worth 302,000 RON on May 17th, 2010.
However, such a strategy requires discipline from investors, so
that they should not breach rules and sell or buy when graphs give
them the respective signals.