How does RVM detect when you've changed directories?

Question

One thing that RVM can do is notice when you\'ve changed directories, look for an .rvmrc, and change your current Ruby version and gemset according to that file

Answer 1

When you install RVM you have to add:

[[ -s $HOME/.rvm/scripts/rvm ]] && source $HOME/.rvm/scripts/rvm

to your shell config (usually .bashrc or .zshrc).

This loads RVM when you start a shell which then overrides your cd command and checks for .rvmrcs as you move around. See the contents of $HOME/.rvm/scripts/cd for more details.