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Question 1 of 10
1. Question
The average trader bound by the Federal Reserve regulations, which presently require that for stocks and indexes. What statement can be deduced from it?
Correct
The average trader or investor is constrained by the Federal Reserve rules, which currently require that a minimum of 50 percent of the market valuation be in cash for overnight positions and 25 percent in intraday positions for stocks and indexes. This means the trader or buyer will have a margin of 2-to-1 for overnight holdings and a margin of 4-to-1 for intraday trend trades.
Incorrect
The average trader or investor is constrained by the Federal Reserve rules, which currently require that a minimum of 50 percent of the market valuation be in cash for overnight positions and 25 percent in intraday positions for stocks and indexes. This means the trader or buyer will have a margin of 2-to-1 for overnight holdings and a margin of 4-to-1 for intraday trend trades.
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Question 2 of 10
2. Question
What does the volume of trade and the amount of money transact tell us about the condition of the trade?
Correct
Liquidity is outstanding in the cash equity markets. The number of transactions and the amount of money transacted each day show you will still find eager buyers and sellers.
Incorrect
Liquidity is outstanding in the cash equity markets. The number of transactions and the amount of money transacted each day show you will still find eager buyers and sellers.
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Question 3 of 10
3. Question
What are the predetermined limits are called when a percentage change in the Dow Jones Industrial Average is reached, the exchange closes down all trading for a limited time?
Correct
When set thresholds, or circuit breakers, are exceeded based on a percentage increase in the Dow Jones Industrial Average, the exchange stops all trading for a limited period of time.
Incorrect
When set thresholds, or circuit breakers, are exceeded based on a percentage increase in the Dow Jones Industrial Average, the exchange stops all trading for a limited period of time.
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Question 4 of 10
4. Question
When using the concepts of candlestick chart what does the tall real body of the candlestick indicates?
Correct
If the candlestick’s actual body is tall, then the price of opening and closing was fairly far apart. Shorter real bodies suggest prices that were very close for opening and closing.
Incorrect
If the candlestick’s actual body is tall, then the price of opening and closing was fairly far apart. Shorter real bodies suggest prices that were very close for opening and closing.
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Question 5 of 10
5. Question
What are the method and the strategy that is used to determine a reversal point when determining trends?
Correct
Tom DeMark and Larry Williams both have a system for evaluating a reversal point using the number of bars on either side of a possible reversal point (in a bar chart). For example, in a low bar, the analyst might be looking directly on either side of the alleged trough bar for two bars with higher lows.
Incorrect
Tom DeMark and Larry Williams both have a system for evaluating a reversal point using the number of bars on either side of a possible reversal point (in a bar chart). For example, in a low bar, the analyst might be looking directly on either side of the alleged trough bar for two bars with higher lows.
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Question 6 of 10
6. Question
Using DeMark or Williams Method what does the higher number of bars on either side of the chart deduce?
Correct
Using DeMark or Williams Method:
To increase the value of the trough, the number of bars on either side can be increased but the number of troughs must be sacrificed. The higher the number of requisite confirming lows, the greater the trough.Incorrect
Using DeMark or Williams Method:
To increase the value of the trough, the number of bars on either side can be increased but the number of troughs must be sacrificed. The higher the number of requisite confirming lows, the greater the trough. -
Question 7 of 10
7. Question
What is another method excluding Williams Method that is used in identifying significant troughs when talking about trend analysis?
Correct
Another way to define large troughs is by determining in advance how far the price will go down and rally into the trough. Typically one percentage is used.
Incorrect
Another way to define large troughs is by determining in advance how far the price will go down and rally into the trough. Typically one percentage is used.
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Question 8 of 10
8. Question
Using the percentage method in trend analysis comprehend the following scenario:
Using 1% any time what effect does it have on the price and on the reversal point?Correct
Typically one percentage is used. Using 1 percent, for example, would describe a substantial recession if the price falls more than 1 percent, makes a peak and then recovers more than 1 percent. The larger the percentage used, the greater the reversal point, but the less regular.
Incorrect
Typically one percentage is used. Using 1 percent, for example, would describe a substantial recession if the price falls more than 1 percent, makes a peak and then recovers more than 1 percent. The larger the percentage used, the greater the reversal point, but the less regular.
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Question 9 of 10
9. Question
What does the high volume indicate when using the High Volume method of trend analysis?
Correct
A important point of inversion may also be marked by very large volume. High volume suggests that activity on that trading day was higher than average.
Incorrect
A important point of inversion may also be marked by very large volume. High volume suggests that activity on that trading day was higher than average.
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Question 10 of 10
10. Question
Which of the following is not a step that is required to draw support and resistance zones in trend analysis?
Correct
Simply draw a horizontal line across each important trough (or peak) into the future to create a support (or resistance) region. These lines may be traced through the respective lows of the bar or, as Jiler suggests, use the close of the bar since this is what most investors read in the paper.
Incorrect
Simply draw a horizontal line across each important trough (or peak) into the future to create a support (or resistance) region. These lines may be traced through the respective lows of the bar or, as Jiler suggests, use the close of the bar since this is what most investors read in the paper.