Don, so long as a company continues to increase it's earnings, given stable market conditions (i.e., ceterus paribus -- all other things being equal) the price of the security will rise. This is not a case of Newtonian physics, but simply a tangible manifestation of investor expectations. The persistent trending that you note in stocks correlates well with two underlying causes: general market conditions (what was the p/e of the S&P 500 at the time), and forward-looking earnings estimates.
You surprise me in one sense. Generally, adherents of TA usually contend that it is a short-term trading tool, because it is designed (so they say) to discern something about the psychology of investors in that stock over the short run. Thus, they look for "head and shoulders", "double bottoms", "morning stars" etc. But you seem to be saying it has validity over the long run. I suspect that we are really saying the same thing: if you look at a quality growth company over a multi-year period the price of the stock tends to rise fairly consitently. I ascribe this to the fact that investor expectations of future earnings swamp current market conditions, and since growth is exponential, it will tend to result in a straight line on semi-log plots (which, in any event, tends to obscure fluctuatuions in price).
Regards,
Paul
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