Technical Analysts and Econometricians: A Question on Methods I've been reading the book Technical Analysis Explained by Martin J. Pring as a result of a conversation with one of my friends who said he did technical analysis but didn't apply the types of models employed by econometrician when forecasting (i.e ARIMA, VAR ect).

as I progressed through the book, I noticed though the methods were simple and required little knowledge of statistics but they worked very well. They call these methods as a part of trend analysis.

My Question: why are such methods not employed by more frequently by economists/econometricians?



Note: an example of such methods can be seen in the presentation by Martin Pring: Technical Analysis for Short Term Traders
why are such methods not employed by more frequently by
  economists/econometricians?


Because the so-called technical analysis ("TA") is overly simplistic and devoid of mathematical (or at least rational) basis. 

The application of algebra, probability, time series, and other tools &amp; disciplines does not guarantee accuracy of forecast, but at least that application provides a more robust framework with which to model financial data than what is achievable through TA. Just to mention one example, TA does not address arbitrage opportunities, which is a useful and consistent approach to pricing financial instruments.


  I noticed though the methods were simple and required little knowledge
  of statistics, they worked very well. They call these methods as a
  part of trend analysis.


There is a false sense of accuracy surrounding TA. Materials that teach or promote TA obviously will present instances where --in hindsight-- the method appears to work. But nothing in TA predicts, models, or at least explains the price trajectory of a financial instrument (let alone its timing).

I think that if/when TA supposedly "works", it is only because of a kind of self-reinforcing feedback: TA "indoctrination" inadvertently prompts TA adepts to reinforce that, say, a price-band (or however it is called) is about to be broken because the price of the stock has touched its limit twice. Thus, TA-based traders react by performing certain transactions expecting to profit from the supposedly imminent direction of the stock.