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NEW QUESTION 104
Which of the following is most likely to occur when the overall market is deeply oversold and on the verge of reversing?
- A. Lagging groups fail to confirm new lows
- B. Leading groups fail to confirm new lows
- C. Relative strength of lagging groups begins to improve
- D. Leading groups make new lows and accelerate to the downside
Answer: B
NEW QUESTION 105
For a swing trader, which of the following is valid stochastic sell signal except:
- A. A
- B. C
- C. B
- D. D
Answer: D
NEW QUESTION 106
In point and figure theory, triple-tops and triple-bottoms, when breached:
- A. Frequently leads to a consolidation phase
- B. Will lead to a stronger directional move
- C. Lead to smaller continuation patterns
- D. Suggest a failure in the longer term pattern
Answer: B
NEW QUESTION 107
Standard deviation is:
- A. An inferential statistic which measures symmetry around the mean
- B. A descriptive statistic which defines the central tendency
- C. The square root of the variance
- D. The covariance of two securities
Answer: C
NEW QUESTION 108
Which of the following is one of the disadvantages of computerized trading systems?
- A. Computerized systems miss many market trends
- B. Profit trades are exited too early
- C. Most computerized systems are unprofitable in non-trending markets
- D. Trading decisions are less consistent
Answer: C
NEW QUESTION 109
Which of the following is a general rule for trading futures?
- A. The majority of capital should be committed to the strongest market since it is rare that more than two or more markets will experience a major move simultaneously
- B. Total amount risked on any single trade should not exceed 5% of equity
- C. Due to the fact that markets only trend 30% of the time, 100% of capital should be invested at all times
- D. At least 50% of total equity should be dedicated to the market group with the strongest trend
Answer: B
NEW QUESTION 110
Extrapolation errors occur when investors:
- A. assume that current and recent conditions will prevail well into the future, also causing them to ignore the evidence of changing circumstances.
- B. tend to be overconfident regarding their abilities and make major mistakes like too little diversification and over trading.
- C. are tricked into thinking that they can foretell the future because they can easily observe the past.
- D. try to identify patterns in financial markets that do not exist.
Answer: A
NEW QUESTION 111
The only effective method of diversifying a portfolio is by including asset classes with ________ correlation to stocks such as cash, foreign exchange or commodities.
- A. positive
- B. low/negative
- C. meaningful
- D. moderately positive
Answer: B
NEW QUESTION 112
Which of the following is a CORRECT interpretation of open interest?
- A. Declining open interest in a downtrend is bearish
- B. Declining open interest in an uptrend is bearish
- C. Rising open interest in an uptrend is bearish
- D. Rising open interest in a downtrend is bullish
Answer: B
NEW QUESTION 113
If 300 shares traded at a certain price which of the following conclusions cant be drawn from this given situation?
- A. Traders could determine the resistance zones
- B. Traders could determine the support
- C. Traders would record four bars at that price
- D. Traders could determine the price at which supply and demand were equalized
Answer: C
NEW QUESTION 114
Based on the chart below, interpret the on balance volume (OBV) indicator with respect to price action:
- A. Positive divergence between price and indicator suggest uptrend is weak and near reversal.
- B. Prices are consolidating but OBV direction has turned higher which indicates accumulation by long term traders.
- C. Negative divergence between price and indicator suggest distribution is taking place at top.
- D. Prices are higher but OBV is sideways which can't be interpreted.
Answer: C
NEW QUESTION 115
Which of the following is a true statement according to Elliott Wave Theory?
- A. The theory was originally applied to individual stocks and does not work as well for indices
- B. The theory works best in commodity markets traded primarily by professional traders such agricultural futures
- C. The theory is composed of time, ratios and wave forms, in that order of importance
- D. Wave four should not overlap wave one
Answer: D
NEW QUESTION 116
Which of the following would provide the least help to a trader who is trying to determine where to place a stop order?
- A. Pivot Point Technique
- B. ATR
- C. TRIN
- D. Parabolic SAR
Answer: C
NEW QUESTION 117
What steps must analysts take in introducing new methods of technical analysis under the MTA Code of Ethics?
- A. New procedures must be documented as to procedure and rationale
- B. New methods need not be consistent with the accumulated knowledge of the field of technical analysis
- C. All new techniques must be fully documented even if proprietary methods must be disclosed to do so
- D. New procedures must be supported by adequate back testing confirmed by at least technician
Answer: A
NEW QUESTION 118
Which of the following are true of futures volume and open interest?
- A. Rising prices and declining volume/open interest indicate a pending change of direction
- B. Open interest increases during a trending period
- C. All of the above
- D. Volume may decline but open interest builds during an accumulation phase
Answer: C
NEW QUESTION 119
Which of the following factors would increase the predictive power of the evening star pattern?
- A. If there is no overlap among the real bodies of the candles in the pattern
- B. All of the above
- C. If there is light volume on the first candle of the pattern and heavy volume on the last candle of the pattern
- D. If the last candle closes deeply into the body of the first candle
Answer: B
NEW QUESTION 120
Which of the following is one of the advantages of computerized trading systems?
- A. All of the above
- B. Computerized trend following systems are profitable in all types of markets
- C. Computerized systems improve the interpretation of complex trading patterns
- D. Computerized trading systems remove the human emotion element
Answer: D
NEW QUESTION 121
Which of the following is NOT a proper interpretation of volume and trend in the futures markets?
- A. Volume falling and open interest falling = congestion phase
- B. Volume rising and open interest falling = position liquidation
- C. Volume falling and open interest rising = slow accumulation
- D. Volume rising and open interest rising = trend reversal
Answer: D
NEW QUESTION 122
Which of the following instances marks a single best valid buy signal with respect to the direction system for the next new trend?
- A. A
- B. C
- C. B
- D. D
Answer: D
NEW QUESTION 123
Which of the following statement states the correct percentage of the percentage gain on a loss of 50 percent?
- A. It requires a 90% gain to break even
- B. It requires an 80% gain to break even
- C. It requires a 100% gain to break even
- D. It requires a 70% gain to break even
Answer: A
NEW QUESTION 124
When a market exceeds the high of the previous 4 weeks, cycle logic indicates that which of the following cycles has bottomed and turned up?
- A. Intermediate-term
- B. Short-term
- C. Long-term
- D. Seasonal
Answer: C
NEW QUESTION 125
In some point-and-figure charts, what is the actual representation of the new price recorded on the chart?
- A. The first letter or the number of the month is plotted
- B. The number of the month is plotted
- C. The name or the number of the month is plotted
- D. The first letter of the month is plotted
Answer: A
NEW QUESTION 126
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