I know one of the main reasons technical analysis for individual stocks can sometimes give a general idea about possible future stock movement is because many investors follow the same patterns. If there is a clear support level at some point, and the stock hits that point, everybody starts buying, driving the stock price up again.
However, how is TA relative for indices ? it doesn't make sense, why would the 21 days moving average on the NASDAQ index chart matter at all?
Do investors start buying in stocks included in an index when that index chart somehow gives a buying signal? and suddenly everyone starts buying in all of these stocks which drives the index up again ? How important is say a support level on an index exactly ?
Would a support level on AAPL chart be less or more important than a support level on say the NASDAQ chart ?
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