Free CMT-LEVEL-II Exam Braindumps (page: 8)

Page 7 of 66

Which of the following are true of the concepts of divergence and confirmation in technical analysis?

  1. They are opposite concepts
  2. Confirmation has a valid technical interpretation but in the case of divergence, no valid conclusion can be drawn
  3. Confirmation indicates a likely change in trend since all technical indicators are in agreement
  4. Divergence indicates continuation in trend since different technical indicators do not agree

Answer(s): A



Which of the following is a CORRECT usage of oscillators in technical analysis?

  1. Oscillators are least useful when they reach an extreme reading near the upper or lower ends of their boundaries
  2. Divergences between price and oscillators are important confirmation signals
  3. When an oscillator crosses the zero line, it provides an important trading signal in the direction of the trend
  4. All of the above

Answer(s): C



According to Charles Dow, what has been the main downfall of Wall Street investors?

  1. Independent thinking
  2. Failure to stay the course
  3. Pride of opinion
  4. Failure to abide by classic trading rules

Answer(s): C



How might one detrend data to determine if a cycle exists?

  1. Divide the current prices by a moving average of those prices
  2. Create an oscillator that plots a standard deviation of the period lows
  3. Apply volume weighting to both high and lows in the data
  4. Plot a linear regression line through the data midpoin

Answer(s): A






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