At AiStockcharts.com a neural network is used as a non-linear statistical data modeling tool that also incorporates an adaptive learning response to the ever-changing stock market conditions. Neural networks are used to model complex relationships between inputs and outputs in order to find patterns in data. You might ask why do we need a neural network instead of some other mathematical tool. The answer is that the performance of a group of stocks in the stock market does not follow any known statistical distribution such as a normal (bell) curve. In fact, most statistical analysis tools cannot be used since distribution transformation does not work in most cases. We are forced to use non-parametric statistical analysis to analyze technical indicators and their relationship to stock performance.Click here
for additional information on neural networks and artificial intelligence, including diagrams of neural networks.