CMT-Level-II Free Certification Exam Material from ExamsReviews with 264 Questions
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NEW QUESTION 72
In some point-and-figure charts, what is the actual representation of the new price recorded on the chart?
- A. The name or the number of the month is plotted
- B. The first letter of the month is plotted
- C. The first letter or the number of the month is plotted
- D. The number of the month is plotted
Answer: C
NEW QUESTION 73
What is the measuring objective for flags and pennants?
- A. There is a different measuring objective for each
- B. Half the distance of the preceding move from breakout to the flag or pennant
- C. The move after the pattern will be equal to the move before the pattern
- D. Flags fly at half mast and pennants are considered reversal patterns
Answer: C
NEW QUESTION 74
Which of the following is a CORRECT point and figure chart pattern interpretation?
- A. Downside breakout below a bearish support line signals buy
- B. Upside breakout above an ascending triple top signals sell
- C. Downside breakout of a bearish triangle signals sell
- D. Upside breakout above a bullish resistance line signals sell
Answer: C
NEW QUESTION 75
Which of the following conditions is an absolute must for a true divergence based on the MACD histogram?
- A. Price action extended above/below the 26 week moving average
- B. The MACD histogram has to record atleast a 200 bar low/high on the first trough/peak
- C. Breaking of the centerline
- D. Confirmation from the MACD fast line and signal line
Answer: C
NEW QUESTION 76
Which of the following is the short-term trading cycle that tends to influence most commodity markets?
- A. 28-day
- B. 19-day
- C. 12-day
- D. 10-day
Answer: A
NEW QUESTION 77
Which of the following is true for the use of the chi square test?
- A. Compares risk to expected returns
- B. Compares actual returns to expected returns
- C. Used as the main confirmation test in Dow Theory
- D. Signals moving average crossovers
Answer: B
NEW QUESTION 78
What is the bearish counterpart to the Piercing Line candlestick pattern?
- A. Dark Cloud Cover
- B. Shooting Star followed by an Inverted Hammer
- C. 3 Black Crows
- D. Hanging Man
Answer: A
NEW QUESTION 79
Which of the following is true of Bollinger Bands?
- A. When price equals the upper band it is considered bullish
- B. The bands are based on the moving averages of prices
- C. The bands are based on moving averages of prices plus or minus a standard deviation factor
- D. When prices are above the upper band they are considered to be in oversold territory
Answer: C
NEW QUESTION 80
A technical analyst was at a convention in which a long-term point and figure stock chart was being discusseD. He noticed that low-price action did not appear as active as high-price action on the chart. One suggestion the technical analyst could provide, to clear up this apparent distortion, would be to:
- A. Change the charting scale to logarithmic
- B. Increase the time frame on the chart
- C. Add the daily opening prices to provide a more visual benchmark of price changes
- D. Change the scale to arithmetic
Answer: A
NEW QUESTION 81
Which is historically the strongest three-month period for the U.S. equity markets?
- A. June, July and August
- B. March, April and May
- C. January, February and March
- D. October, November and December
Answer: D
NEW QUESTION 82
Which of the following is an INCORRECT definition of cycle terminology?
- A. Frequency - the number of cycles that repeat every 360°
- B. Period - the time needed to finish one wave (cycle)
- C. Phase - a measure of separation between the top and bottom of a wave (cycle)
- D. Amplitude - the height of the wave (cycle)
Answer: C
NEW QUESTION 83
Which of the following is a true statement according to Elliott Wave Theory?
- A. A complete bull market cycle is made up of eight waves, three waves up followed by five waves down
- B. Corrections always take place in five wave patterns
- C. A trend divides into three waves in the direction of the next longer trend
- D. The two types of simple corrections are zigzags and flats
Answer: D
NEW QUESTION 84
What is the main impediment to making objective trading decisions?
- A. Failing to consider trading costs
- B. Lack of complete information
- C. Emotional considerations cloud judgment
- D. Conflict between technical and fundamental models
Answer: C
NEW QUESTION 85
Which of the following statement is not true about the Diamond Top with regards to pattern analysis?
- A. It is a profitable pattern
- B. It occurs at the top of a very sharp upward rise in prices
- C. It is not rare at price bottoms
- D. It consists of a combination of a broadening pattern and a symmetrical triangle
Answer: C
NEW QUESTION 86
Which of the following is a TRUE statement about the Stochastic Oscillator?
- A. It moves in the same direction as the Williams %R indicator
- B. It is not as sensitive to recent price action as other indicators like Rate of Change
- C. It works best in a trending market, when it confirms the direction of the primary trend.
- D. It examines the most recent closing price as a percentage of the price range over a window of time
Answer: D
NEW QUESTION 87
A trend based trading system where signals occur when the current price reaches a new high or low:
- A. Point and figure
- B. N-day breakout
- C. Simple moving average
- D. Swing breakout
Answer: D
NEW QUESTION 88
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 higher but OBV is sideways which can't be interpreted.
- C. Negative divergence between price and indicator suggest distribution is taking place at top.
- D. Prices are consolidating but OBV direction has turned higher which indicates accumulation by long term traders.
Answer: C
NEW QUESTION 89
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