Study Guide for Technical Analysis Explained Martin J. PringMcGraw-Hill Ain Mere inp copy: ©2608 Mari A ph retred Pe in the Und Sats ‘PRs Ee formed debe Unteg Sues Copp tno Ree aired esas bee rece em ou ie or mote pe ‘into fe panne ho oe Garé Say eas New Babe Maer Fosatng Fined and boon RR Donley & Sens Company “This putin een to prose sect and suheae nformaton in DEeidccncr te per Gcnpeed in enceng ep tcuniog ore tee ap tar peace ae Nenetncnrsen Fas acc Phan bpd icine Crome yates ee boc ae pei an icons ee a rei tnd ale promotor ora narrate ining Pra er mar afer Tie BSE ee ier Spt le Pro! oing “Tis took pm an ee ace pape consning 2 mini of So eae semis foe Contents How to Use This Study Guide 1 The Market Cyele Model 2 The Relationship Between the Financial Markets and the Business Cycle 2 3 Dow Theory 15 4 Typical Parameters for Intermediate Trends aa 5 Price Patterns 2 6 Smaller Price Patterns 39, 7 One: and Two-Bar Patterns 45 & Teendlines 51 9 Moving Averages 59 10 Momentum I Basie Principles 65, 1 Individual Momentum Indicators 1 73 12 Individual Momentum Indicators It 81 13 Candlesticks 8714 Point and Figure Charts 15 Miscellaneous Techniques for Determining Trends 16 The Concept of Relative Strength 18 Price: The Major Averages 19 Group Rotation 20 Time: Longer-Term Cycles 21 Practical Mdentificaton of Cycles 22 Volume Principles 23 Volume Indicators 24 Breadth 25 Interest Rates and the Stock Market 26 Market Sentiment 27 Applying Technical Anelysis to Contrary Opinion 29 Mechanical Trading Systems 30 Technical Analysis of Global Markets 81 Technical Analysis of Individual Stocks Index 95 99 105 im us ug 125. 129 135, 14 147 151 155 159 165 169 175 Study Guide for Technical Analysis Explained-How to Use This Study Guide ‘Th study guide hasbeen designed at an adjunct he fourth eon of esha Anais Explained The quesions ie presented in ameed fone Iulipe choice, matching answers, and filinthe sian Sect ae ‘ali a visa ar, concern iin ehar Inerreation quesions ta tering chara have been included se mucha pole The Beak es be ‘pli ito two pars: one forte quesias and tie wher fos eae ‘Where czy. the anovers contain nara by ty of eipanacn Ty tse to expedite she ting proces tse afew nae en ceded the bac of the Book: one set for quctione andthe Sher aes ck felerence forthe answers These shes hve been perfonied enc detachment. Even, the reader stl eneouraged oreerto these samen that conain expanains in the Aner seston of the Souk, Sone of ee shee atk you “eter tothe hare” Thee Secu oe che one interactive action by the reader The anes eters ual do, ‘be leary defies at witha eer fora muligecholee question ot See Fequiedin tanking quesdona Some quesions ah tunis cote mcg jnvInmesicaes, he inter of he anoves primed in onder o ero ‘Sie guidance Each chapter of Tcl AnabuisExpliad with the exceptions of| Starter 17, "Puuing the Indicator Together and Chipter 26 ‘Checkpaind or Mdenithing Primary Sch Mare: Pests nnd Poeghe nes been allocated a uiz,Theirszer ary Sopensing upon ine ergo ase ‘alconaines inthe book Reader ae adied to Fis study the seevan chapters in. Tecnica Anais Elina ad ten proceed to he ening phase. & bref somone, fhe subject mais contained in each indies qs nloced eae begining ofeach Study Gude chapter Ths a petal tol he ee imporant subject covered bythe quis td is inclued st guide Sree nga more cael std ofthese tpi, the reader be fox Seer oe son oanmver the various quesuons mere scaly2 ay eT Sy te Wess than 70 percent ofthe quetons are savored correct og ened tat further nd ake las Ti shoul not be done righ aay 8 ener approncn trea through more chptes and comme baths ter {acetone problem chapter or shapers In thi nay tere vl be lew oft tendency totam o fore the learng procesr burt lesitndbe inanore ‘eure and tought vay 1 The Market Cycle Model Questions Subjects to Be Covered ‘The mos common ypes of rede ‘The tsi of peatandwough aoa ow peas ane wrough ar ecopeeed 1. Name the three mest impor en a 2, Match the aver forthe duration of thee vende 2 Shor ‘& 0023 ean, 3 Invrmediace B tiopwecns © Primary € weeks to months D. Secu D.teesyean 9. Who need ae an undesanding ofthe airesion and may of A Inventor 5 Taden © sane D. None ofte above4 i conte 4, Pakanasrough nase ‘afar too simple an apprch forehand! with 1B Was very useful in Dow ay buts now outdated by more spistenedspprosnes ad ool Should be ued in onjuncdon wth ots tools inthe weightof the evidence approach , Only wos ih bor ad intermeslae wens E Gand 5. inde folowing chr. which er mars he ee in the pad propesionoftough a x 6 an th pipes of pata. rough srosrenion barred oa BN 7. Ina general sense, why are longertrm wend eases spe A Because he bigger they are the eater to ee hem 1B. Because ere i lesrandom noize he longer ne rene, A, the expectations of market pariipantstnd to unfls nt more {raual wa tthe fundamen eve. ote 5 . Because there ar aay fe lntermediat movemens in every nary tends all you hove to de coune fe . None ofthe shoe Pleae lok athe following char fearing Croup Ifyou knew ‘atthe high and low pececng the rly st point were 6 and especie andthe close a Aas $25, ould th repevent clin peat in pakanewcugh anni? BN ‘The tees of decining peas and woughin the following Cigrosp chars revened a pot E None ofthe above Ac pola ine char ing Cg. ee of ing pens 3 le1 The Market Cycle Model Answers 3. Short intermediate, andpeinary. Any order uae aa cores 2 ASB BHGC=DDHA 5. C tnsestors need to know he diresion ofthe lngtim tendo 4: G Peakandsrough analysis tsi tol of techilanasis and Shculé never be underaed. ‘A. The principles of echnical ane can bea to ianeneinme, 7. B. No only ae he easier to spot, bu general speaking. the longer the me pan he more acre teases8, B.No, the rally at point A enor erage betes eid and wo | thirds of the previous dedine | 9. E-Tisis because the sre of declining tough ws ilinaet a point. | 210. Only he series of ring woughs was revered 28 the lng peaks | | The Relationship Between the Financial Markets and the Business Cycle Questions Subjects to Be Covered “The chronological relainshipbeneen the nana mares and the Tne gle ‘nen they pent snd ough io deere Uncersanding te sigeennce of th leads and ngs 2. Trends in financa marke are, 1A Determined by inenons expecaonr a | ‘Therole of techie aralsis 3B, The eft hoe change a keto hve on the pie ofthe asin whic aspeeite franca market dea ‘The pyhologel atstde of intenare othe fandamenil D. Allothe stove10 ote? 2. Which isthe correct hronoogi sequence for peas and eoughsin the financial marke oer te coun ofthe buns ele? 1% Bonds, sss, commodiies 1 Sti, eommodiaen bone . Bonds gold stocks commosiien D. None ofthe shove ‘3. When are commogiies mostly 0 bttom during a recession? ‘A Wien cis parca severe 1B. When the preceding Commo ral ha Been particularly speculate ©. When tact boom extern wal D. Never 44. Why do bonds, stocks, nd commodities experience moves of Aiteren mage snd dure in dierent eee - 1%: Because ey aacoune dierent tinge B. Because cach busines ye hae deren: characterises, Because te lead and ing eter Because ofthe normal Supt ye chronological sequence 5. Wehere sno recession, there no financial market eee Aine B Fe 6. the lead beeseen band ad ot at mae: boom it pardelartyeng you shoud expe eee ‘A Aweakerbullmarttin els B. Atwongerthan average bull maeiin socks Noting outa he crdinary . Aweakcommasiy bull mathe 1, When a recovery estends wel bejond the nota years without undergoing recension bu the gro se ona aoa steably in the mie. A Thisis inownava double ce 1 Ine nan markets como experience the ual chronologies) sequence G Therinancil martes do experience the usa chonoleiet sequence pb Amec oe u 8. Knowing cher in chronologies sequence of nancial marke i Interesting bus how an echnielsaes be wed deni the pina? 2 By tia and ror 3 ing lng mong serge and her cigs for Ienuihing he pesion of ach marker with several technical Indiatreand reling hem o each he ae cro oe D, None ofthe above 9, Please fil inthe Bake ‘When bonds and stocks ar bali and commodies are bers, chis Sage 410, Which industry groups haves endeney dowel in Sages IV and VP A. Earning ten B Liguidtyarven G Allgroupe - . Group sense to iceresrte movements2 The Relationship Between the Financial Markets and the __ Business Cycle ~ Answers3 Dow Theory Questions Subjects to Be Covered. ° ~ “The concept ‘The tenes ofthe theory Wino developed Dow teary ow erning point ae recognized ‘The liao of te theory 1. Which ofthe flowing satementsarecomee? 1A: Dow theory ie not concerned ih the econ ofa move, only is 1. Dow teary snot concerned withthe durson of move, only is dreedon. (. Dow theory is concerned wih both he drecon snd durson of D. None ofthe above, 2, Whleh of hee zatemenss i ncomee? 2: Bow deoopaang Cates ne Dense ee mse . Dow vas concerned wit foresasang business condivons tough these of tock prices D. Randi 16 omer Wasi the sige eat wigere a primary bl wend? 1 Aseres of ngicermedate pels and rough by ether avemge 3B. Adidend yield in tne UIA in exon of Speen € Bow serge conning sures sing nermedine pest ang rough Which of the following are base ene of Bow theory? A. The averages distant een, 1B. The DJIA mst yell than 9 pecen before atop can be signee . Price ation determine ih wend. , Lies form at artery bt only tr dhe DIL yi than Spereent 2, Thesverges mst confim, Volume mast expand on decines GABE and? HO AClanaE. 4 Wino developed Dow's principe and orunited them into something bow Rober Rhea ©. Watts Peer Hamion D. carey 6. When compared tothe buyheldsppoach Dow theory works at ‘ella secular bull marke tin mien wading copes 3 Fale 7, Looking at healing char fentsognermesiae aie and reacions at happening tain A ADow incon buyin B ADow theory tl sgl © Asetlsignal by tne indus that uncon he tanspote D, Aiellsignl by he wanspore thats unconfrmed by the ledusrae onto v “ich of hese natement icone? ‘Dow theory is easy iterpretifyu olin the rules exacdy 1. Dow theory often leave ie ana In el beseae ng sometime eu a deny intermedine price moments © Becnuse Dow tecry as beste the bapa appreseh for sarof the event cent, wl eontinue 640 ne wen . None af he above ich ofthe folowing are not ene of Dow than? A. Themerges discount cveing The erage mus confers Volume ins nuit part fhe theory. D, Pace action determines the vend E ABande Found Dow theory unequioeally signals primary vend een thie ‘E Gantanicer tine priny end has revered 5, Isone piece of edence anew veryimpertat one tht che pinay wend hae revere © bootie wo resucin a bear market because the neon ie outed , Means thatthe sz fhe preious pina wend cn be ied at ‘au ee forecasting he aurion and magniads ofthe nest primary rend E Bana 53 Dow Theory Answers RoR 20. Dow theory endo gnewhipnn in atong secular bl ares, .Theindusiale wigger sl signal, but the wanipora conse o thee outaline formation, When the pice teas brow De lower Teel of then, confirmation igen and » Dow theory bear -Volumetsa biiground itor used to elp interpret mare, ‘uring pointe, not an integral part he theo 1B. Dow theory offers just one pace of dence thatthe wed as evened Teceiiny docs nx gosraniee hats new porn etd ‘unfeding and defintely coe not forecast the age a furaon of he nest ane. This Beaute here leno Enon method ‘aceoratey and consent forcaring te magnitude and Guraon fs fortheoming pice wend4 Typical Parameters for Intermediate Trends Questions Subjects to Be Covered “The relationship beoeen iterate and primary wends ‘The imporance of mtermedate Lense Diferenang bemeen pro and countereends Reuons for intermediate Sense ‘The nature ofnermedine ends 1. Why ls ithepflwtave sn undersanding ofthe character and uration of pie imemediate wend? ‘A Tohelp ass when he nent shorserm vend wl begin B. Tohelp sci when he nex primary wend thely begin . Toimprove ices ser in eng D Bande 2. Recognising that here ae numerous ex \echnal theory how many pinay ine sess prin tend compre 8. A bear mares incrmediae lly ‘A. Mpa ae ford wechs Bl eoumer tal rend2 ones ©. Sometimes éevelopsa he end of bull market 4. Which of the following apy to an mtermediate coresion ns Bll mates 1. They are vvally eat shor and can therefore be exerely profabie Lastlonger tan an inernediate pice movement Diawmac ‘5, Whi of ne following are egiate causes for an intermediate ‘corecon ns bl marke? ‘Detroruing paisa cliste Reduted experaons for corporate profs ‘Taderscorerng shor: postions Abande Reseed 6. Based on Garde’ obteraton forthe stock market beoneen 1895 and 1955, bow many phases of iguida ee he norm for otra One 3 tee D. None ofthe above Pam poiwe 7. Asecandarycorecon mutt ean upward or downsard price Rive 8, What isthe dierence benseen pray ntameiate price ROR Secondary reason cesape na bull market and a piary intermediate price movement develop ins bear mare 1. A primary imermediae price moveme develops in 2 bal market ‘a a econdaryteacion develops ina beat mare, A primary invermedite pice meetent develops in the direction ‘ofthe main rend, secondary reatn rs counerecal pie , None ofthe above oats 23 9. Intermediate wends in secusty prices are determined by 1H The wilde of market parsiipane othe emerging fundamentals Corpornteprofis and ether fendanentle D. None of the above 10. Asa general tendency which stemen i comect ‘A "The larger the preceding intermediate rly the ager the 1, The smaller the preceding intermediate desine na bear marke, Seta the be mare rally (GT lager he intermediate aly in bull markt, the salle he . None fhe above.~ T 4 Typical Parameters for Intermediate Trends Answers 2. D.The covet idencaon afintemedint ends ass dis! ineuon Fist ifunetone ss evidence tthe proaing Ptary ‘Wend iabout oor ajar reread Since imePmedne rice ‘movements nt formar week even mony they provide wel 2. C.Three sie esublshed nar, bt there ae numerous excepont (othe. Tren hould not be confused wih oes, piel there are wo /Itermediat jes ia x primary bal mare, 8, B.Typlaly an iterate bear mack ly wl last for aich ‘hore peiod than an intermediate aly 2 ball marke, The ‘erage for the former bene 1982 0 1962 Tees and Dae ft acer as 20 eke 4. A.Concatrend moves are mor lable end up 2 whips thas poe 5, Guatany one ime sere ar ourmajorinfnce on pies | zehieal, menetry 2nd ecsomie. Al fepeient ons tha js correction 6, B.Thisisnocuvein etry case, bu the second uae of iidaion ‘fen ner inthe grep pte when params ses dguned ‘th the seein quenion thatthe ae lingo how nthe toe26 eset 7. B Secondaries can also ak the form of sideways price movement 18. Primary inemedite price movements ent at mich Longer snd esperence gener magnitude an secondary coneeone 9. Aauthough hele ofits rea ther fundamen tr eimporant isthe aide of mare parcepans tht mea {in they gnoe faces ar would prea hate bess he Cae for anne pce movement snd eee 10. €.Thisisnaavae theese, but general range the case, bat generly speaking, the stronger the ‘iy de weaker he srscerent On omar teen fe ‘Scondaryreacion na bal markt commentators sel the ew of ‘many that pres are expected comet mach further ar aly hey uve only erated a faction ofthe previous advance thi ews ‘Sedona ou can rest assured tha the corecaon ib prob once nd thats new upg aus begin Price Pattern: Questions ‘Subjects to Be Covered “Tranton phases in mackee Tenuta of pice paterse ae and antes sealing Signieance of pains Measuring impentne Devermining the vay of breakout iS 4 To the marke echnian, the sansonal phase has ren significance Seca A lisanyospe 1 lear ater he form of V formation, 2 Tamara te turn point beeen» Sng anda illing market 2. How ze ranstion phase signal in the marke! ‘A By monitoring tones inthe meds 3. Augpion athe Sow neon © Quietmarteracion 2. By eat definable price psers of formations ‘8. The “ne” formtion developed from Dov ther similar K keaage BL A fae hesdandahoulder op Le Arectange . LBB, Nove othe above28 4. Please ccte a headandshoulders tpn he elloning chase. uation 29 6, Plene cri led reve head and shoulder this char ahs — Ai pibh gli Ag We “$7. Why do you think the avers head and shoulders inthe previous chan faded ‘A Because there wat no apprise increase in vlume on he breakout, ma 3B, Because yaa countered move The pars war oo soa LB Ase, 8. Mach the opposes. For example, A Dissbstion fe Recumlaton B. Resdanduouders 2B, Deseensingrigheangles B= Randsoon ‘ep wrgte Ratstanee © Inver hea and shoulders D. Yale breskous FD, Convnsend mone E Provend mone FE Aacenaing oh Tangle +9. Wiha ai sel, neh verti nc repreens2oublingin the pie ATwe Tate & E Suppor30 Comes 10, Wha adranage does the ao sae hate over an ret sang? 1 All motes are measured proporonsey snd ples end to move in proporion because they rect human prehsogy 3B. Ontongterm cara price ngs laws ech are mote We . Measuring objects Pom dowd per complevons re BM abo, 14, During the formation of pric aterm thereon of he breakout ‘not known, Therefor. poo mul asune - Aha price wl ean nthe econ aFkeproallng ead '. Thattoppriookngtrmasony wl oreah tothe ese Thatformauons tok he tases il bea othe opie D Bunge ee eetene 12 Which te met impor dtersinas othe sigan of prepare FOSS Re peng ot ne ly of econ peceding it 1B Tessas and cep pecs © kanes ute a 18, Name the puters (o led pater) contained inthe thre clipes & [P14 ati the derence in he messing ipliaion for consolidation fecangle and a reveal seeangi? (Boh ae drawn on {Tro wale and have the ame Sepih) 1A consis ectngle wl havea greater pie objec, 1B The several reungle wil have the ager pice obec ‘one a>: Tefeaoge tatoo te onger form hn the emer pace object 2215, Some ofthe factor hatyou shoul consider in dering the ‘lay ofa breakout are 2 The volt of eeu i Whether the brehout held for more han ove etsone The ine tfame fhe char (ih nunany week an 4.) 20 and E Bande F ABanac32 Ops 16, Tye lee of volume on sn upside breakout ie imporat. 3 Fave A, Troe Fie 16. Aheadand shoulder top consis of ‘Aha aly ane eo srr alice B, Anal liane ar lean thre sale ees ‘fia aly spartea ye salle alee ;. Twosmal lie tat precede sarge aly ssn cot LE ammo pe elena reat 1 Sreaout . 20, What are he dsinguishing charter of an HRS bottom? {Anal decline separated by ov smaller declines, 1B Anotceale expansion of cme ding he formation ofthe Bpneenouder G. Roosiceable expansion of vole during ihe breakout Bi Asma 21. The slam lee during the oration of the second top 04 second ‘otto ins coubie op sna double boson ormaon sould be [Kare ears he second tp and ee ole for the second 3B, Lessolume or the xecon8topand more ome for he second 1G Levene in both nsanes than te nal tp rbot D. None ofthe sve * etre 33 22. Tangles ate general more reliable than HAS op. Ee peal oe Nees, nf ow" ~ Ny lew sl.Price Patterns Answers7 El +s mes ove char poses the answer aninch repented. cou ing, dovbling:4 10percent Imei, 2 perent move a 20.0. »- ——Bhg ; cena fone bt . 2 2B. The longer pater sks o form, she greats fs te and therfore the mote ig 8 AZABEGCHR, 9, BLWith arise, ‘roporonae mere ‘he scalngané Rove eh38 owes 36, €.This is because se measuring ject comes fom the depth, not the siz ote pater. Since both have the tae depth ther measuring ojecse wll be ental, 15.D. The ueframe has no influence onthe validiy ofa breshow only signiianceAbreatout on 3 dly han oot cs imporae aber fons monty 16a 1B 18.6. 19.6. The lel ofvlume ona downside breakouts not npr but lave ight volume on she formation of te vig solder 2c 22.B. HAS are uly ore elable than eagles 28, This is because it savas sumed hatte prealng end in {oece unl proven athe. The anmwer sone chars Oye 6 Smaller Price Patterns Questions Subjects to Be Covered Diferensation beoven parce aterm recognition Types of gape and tei significance 4, Honing does pclae 0 form on dtly char? A wok B loweets A Svecle D, Sone 2. A pennants formed wth UA Two converging wenn 3 wo dering endings wo parte tines To parallel ines tha lope don a2 downed and vp an peend 5 None athe patterns showy In this chart are perfect Bae on he 2 What are the default overboughovenld bands fora MaRS A802 ° © sora307% coment 5 The RSLs more volale the shore he ne pan we 5 Fae 4. Wi eer ine following char corretpond vith bears aire “ c 3 E. None afte stove 4 *s e 5. Name one advantage thatthe CMO has oer the BS 2 Teveaches overbought overs extremes more fen. E Ienece ger ise signe " 6, tn he following car. wien ofthe 0 Sie more elo be Plots fms Say sme? 4 Taeonein the lover pare) oon 8 1, Pease match se flloving aner ac 2. Benth lure sing —— TA: Relaune nrengh indicator * Gebers ring band Chaunde Momentum —_G. Relate Momentum Index Srcler . Seay St 1. 70/30 overbough/overtld eft E s5ndek RSI —— & Areited ith area from Shuptend ox doenvend Wot ading ston RSI 1day sine span eR “The RS canbe interpreted by sing ever in penrough 7 prope 3 Te , Only afer ure singWo omen un : n 9. Thefatloning nomenc nterpetie techniques canbe wed wih 14. In sochaic interpretation,» ighthand crosorers considered to be heist Amore poverfulagnal ana lethand one [A Tendin and price parm anabsis xe B Mowag merge sna ie ature ings , Ovebough/cneraté sahis 15. Which ihe fter ofthe vo soci indiaton? i) SSS rete = es “Thar it ne diference between the MACD anda vend deinion y Aine 2 Acaring tothe tent, an MACD ie bes interpreted wing XTegaline B Trendlne ition and exerbough/overldcrowores Complex avegences , Megareese divergences 718. The elation of the sochaic indent asus the price doses i {ioe oa undingnge inh ideo end I BS Gace ne vacsee sf td ashe ia | Govt eta en fn | Seta doses 1 2 ee ETE eno a coment nd a clove ois high at! 11 Individual Momentum Indicators I Answers 2. D.70/80 ithe correct deta 4. EB happens to bea bulish failure swing, but the question asked fora bearihone 5, A ttreaches overbought and oversea extremes more lien and ‘Rerfoe lend ac Bee to oarbough oval sea 6, A This because is more vole The shoes these span, he 7 AP ABER C#GD=REWRFHD.C=6 10.E 1, A.A MACD ita form of wend devinson indicator 12, B Signa line crutovers ae consigered by ‘> sspeally ithe chosen parameters reat in x smoot indent but ‘He ext Indicates hat theve awe pumerous whines hat ae ggered ‘rom thi pprouch wang the detalles opal char. There nosoch conceptar a megarevnednergence. 1 fer good signals aby ot ”80 cone 12 Individual Momentum Indicators II Questions ‘Subjects to Be Covered | ! | Aroontankl ote Cage tt ed Anaad 2 oe 32 3. Thefolowing char features we ADK Which on cae from theshorer une pant ‘A The one in ie encer pane 1B The one inthe lover pana 4: Atpolat in che following char wis factor sugges the ring price ‘endl conus? ‘4 The breakout rom the inverse esd and shoulder in the peice B Thebreaoutny ne aay The plas Bivens above thems DE D Annas E Bande F ABandc Onion as ena i 5. A hay ADK ending that peaks rom above 40 els you The pee about aly 3, Direcsoral morement hs now peaked an we should tok fora Sigifcancmangein cena. © Direcioal movement has peshed but we do notknow the gnieane, , Noneaf te above 6, The pls Dt crosses below the minus Dl and the pie completes headancahoulder top. We should ‘De nothing und we can obese paling ne ADK, Whit forthe smoothed Dist cross, D.Aande. 1 How many ROC simetrmer ce wen he RST formas? pone Four BL Three| 8. Which fhe oouing technique ae not sed in interpre bok * ° ~ 2 MA croton By Trendline rah © Dhrergencer D. Complex cesoers 2 Whe sate te foned bye age end eee? A Aare Ket buy sland cena Ore intermediate EST ” 2 Alongtem BST by spa am above sro E A pritccontrme ogre ST by Sel tom bow sere B. Alhonsem 167 by ov memes pases wos ak 10. The KST tends to work bess Av hiveonsructes win our ders Une Yana bat eect aierert cls, 2B. Teisweighte vo ge more dominance othe longer eye. has been gore ened, ero D Ames EABandc 12. What ar the parte fr ie paabe ‘A. The tine pan of toe serge and the sezleraon ctor Bi. The acelerton aor snd ne maximum stom quotent € The secreraon tor and ie manu aceenoe ee B. None ete aboxe 1. The panel ca be eda nopandeeeral gem 5 rake 12 Individual Momentum Indicators II Answers r See ee ee aS ae sesh ‘Teen ane cons ay OK an err ne en Sela Sespaaece sf nel iteroe ca ook eps c There toch thing a8 cones eouer hae ar onl complex dergences (G.The longterm RST isthe dominant one a therfore proses the, ‘mow signee signal,86 Gow 2 10..The IST may have been tated, bu woul nt work no because had been tested bur because evar earflydegned. The testing sala ave beens byproduct 12.A.lisnotsecommended though bec il gg contend Signals wen sed in soy Questions ‘Subjects to Be Covered candle consrvcdon 13 Candlesticks Dillerendaing beeen and eccognitng the various patems 1. Canal chars cone of 1 Opening paces 3B. Cling prices © Aredbedy D, Avice B Amie F Cane, 2. Ponty hae prc ata forthe hgh nd one which pattern wilot how up crecyin cane hare 1h Enguling perme 3 Dg Meeting tines 2, Plese iin he gaps In candle charting the retest emphasis is peed onthe aie and he, price,8s ome 4. Wha isthe highighed andi pater inthis char 2 Abeanh engulfing B Apieringiine © Alakctoud cover 1B. None ofthe above 5, Abammer appear ats botom anda hanging man atop. 2 Te Bribe 6, Pease lin the gap: ‘candle where she real bodys rl and develop a the igh end of Sevesionsvading range eee (9) 7. Ae the pavers in he following char abled corey? cote a9 8. Which, fay of thefts ar several pater? 1A Rang tee metocs alloy tree methods © Upie ap (est) D. Shooting 9, Candlewole charaarehepfl becawe 1A Wecaayospoccandes where volume bea OF Iga then wo 1, Tes pombl to dupiay more ander in se sume pce, . Mare several candle paters ae duplayed Daande 210. Which of he fling i not tue satemen? ‘A Canlercan be plowed foray Unerame __. ‘5 Gana caring canoo be wed tn western charg Cnigue, © Ganle sharing nenbance hen ted ws ener charting technigos, 11. Folloning a aly wie candle ave dential losing rice I hina occa op? 3 Ne . vl depend on whether the cle reprstented he highs for he 12. Wich ofthe fling correc deseribes a counteract ine? (A To candle with long sl bodies falloning sa aance of Aeing colo wth ene closing price 1B, Two candles wih lng rel Bose flowing’ ene where the ficial the second vies thelr opening poe © Two eadles with long el bodies followings cin wher she ', Tho candles wi long el bod lloviag a cine wher the fri black, he een wie 288 theo picsal rw leon 7 ay) yr| 13 Candlesticks ACB BAA CHDD-C 1S.ArGBeA:CeBDED .14 Point and Figure Charts Questions Subjects to Be Covered Poin and figure vers br bars Seting box moun Metring abeciee 1. How do tarcharu and pint and igre chars fer? A oineand gure chara are plated sc epecie nent B, Point and Ogure chars record all me pevode CC. Point and Spare char can never De pleted foriniaday intra . None of henbove 2, Wabox suet at price movement of pln hit en thas X Ailton ies than 8 we recorded 5 Only suerte gener than Sl be pote Price ucratons e3poin vl be recorded, D. None ofthe above In point nd gure chars, sve ploted for ring pice and Tor desing ones 4, Forstoch wading above $90, the accepted norm for abe € Soin, D. 2ealiars15 Miscellaneous Techniques for Determining Trends Questions Subjects to Be Covered Support and esitance defined Determining Healy suppor restance poine Techniques asocated with proporon interpretation a concentra of supply ain chal aly 5 Fate 2. ete pre ho ad esstance atthe Hck nine flowingi 3 i j i 100 emg ame fou phniea characterise a dented inthe tet ha could 1h Moderate overbought levels * Proporionate erscement ana projection etl © tiki inend Diane suppor/rsitnce area guns ie gnifiance om ‘A The moan a ey tat develops at pete point 1 Tre peedtotane previous move The umber of people tnt wee previously stopped ox tht peer) wor san Be ‘ea conceninion of upp ient temporary oct < 01 6. Blin he blanks Supportna concentration of (4) x suena oi ala deci 2, Blin te bak: Propordonate move are ear to spoon __saled chars 8. Which ofthe fllovings nota Hhooace number? ns Ci 9, le pre ils back t= kona fn ine, which cours of action leptin? “ ‘A By Seca isa great oppsriaiE 5. Gonsser baying bt alo fok at he other ingletors . Conner gong shor the ine penetrated trie ther z Ideatr bere sing any scion BandD E AadD 10. 1fhe pce retraces more shan nothin of ray 8 feo foncude thatthe rend ha revered Te 11.12 ange ine froma posal pointe 48 degrees and he char pve psn py ac hee nt € 8x1 wb Cann © Leonardo Da Vin! D, Edson Gout15 Miscellaneous Techniques for Determining Trends Answers 1. B. The quanion defines esstance, not supper. 2, B.No, iil find support Support delat on the say doxm and Fessnes on the wapap (6. A-suppiiB. emporay '9, E-Fitonacl fn tne onl Fepetent an inaligent ple ange revel: Therefore resew of omer ndatrrinmandaton: When the lines penewned you can expect loner pices, butt mandate toveview he other inden: Far esampie, te price maybe overald that pointand oonoe hp 10.3. Sometimes price wil erace 100 percent of aoe and more ‘This oes notin and of ul signal hs the wend far enone Tee ‘wothirds reeacement concept meri a gcse co ndicne tate shoul expect o ee mos recreate oo Sere 12.D. Edson Gout esa CERES) Unis Chad The Concept of Relative Strength Questions Subjects to Be Covered hai celathe scent? Interpreting reise sng Coating the rea othe abolte price ‘sing enines wih seasine svength [Comparing there acon af 0 dtferene sock makes 1, Which othe Following teres i tue? ‘A Relate azength mesures the seaionship benveen wo 1, The relsionship berveen stock and a market serge he only ef wey fing renin sucngeh Comparative relate sengeh inlaes the RS Do Amee 2. When the RS ren reverses the downside. iiss to conclude Tiare price wt ooner or ae fatlow ite 3 Thats proablya whip since the pie fa no conimed {© Thatyou should be onze lookout formers she cok breast weakening RS olen precedes opin ie atslus Sake . None of the aorEa me | extn . 107 83. On the char belo pease drs hendand shoul tp onthe RS i a line where the moving average salad a apprninaty Ue me z tine ashe nechine Ax example (thou neha cron fas 5 slready been constructs offer youroinepudance { # per | eae von aes aoa dd 4% 8 ~ gaol Nog, one a = i gad, a . : spy, : 5 ‘My Inala car gene = i bess 2 Threw ecnng elope ad ough on he pe : ee =e ee 5 The Shar arena ten desing hep. : & Therewarnostongcitonce 4 When posve RS dergence develops you shou once Tiare 8S yen snow up a B Nothing } © That he echnical postion Isimarvng but you need oe Sonuesoaanrteuetgs, _ ern, On the fon cart plete dav mo wendlines eseen 197 snd pe A ~~ MY ‘esate byte ach | | | (6. What was the piece of conclusive evidence that suggelted the rallyat A 1999 hat would have sigaless rend reveal im pre ana RS. Tip 1 One iss #yeeriin nd the oer va Ssen line108 cote 6 7. Wt price con sugges that theo io dhe absolute pie a Bin the prow car would be ken out onthe dawns? 1k Fhe pce nae en fling B Gactes The Raine nad aresdy broken elon is preou ow D, There lenses £8, The pice af comm edie bythe SEP Compose. le thie BS felsdonshipe B. No,becaue one ies commodiy and the ober ea market index 2. Asscong upzendine inthe NASDAQ/SEP Ra ie olated ands Ipeandshosider op comptes. You shoul, Buy We NASDAQ. oe Sal ne nasDag, - © Buy west Shor the NASDAQ nd buy he SEP Shon he SeP ane buy he NASDAQ 410, tF be RSine fo the FISE beens out aptnt he World Sock Index butt for ie Seah market door no which she Sein bay Tied on ts rendontip sone? A The TSE © The Word Index Answers 16 The Concept of Relative Strength 1 A, Comparae relative rength shoul never be confxed with ie The tng indiestore There ae oter wel ways of appI0g RS {Sparttrom comparing astock rom marke erage “The aneverie shown in the char, ss SE4 Ds-This is corect because you need ose more evidence that he RS bas tumed cere imporanty evidence tat heck el nw nan spurend 5. Theansweris show in the chart 6 ©The decning RS wa evidence but not conclu evden, 7. Ge RSline was already below ts previous vough 8 A.Sinee comparave RS compare one cut with another this {ale HS reason, 9. E There sno esdence that ether ofthe component hat eered end therefore, choler A through Dave no oppoprinte See oe ‘Seah inden thatthe SEP wil ow cupertors he NaS ‘SEP shouldbe bought and ine NASDAG sored 1a. 18 Price: The Major Averages Questions Subjects to Be Covered “pes of erage and indexes J Uae and heir relationship wih he india ‘The Value Line ad a market ncicater [Natur of he Rotel tndones, 1. The SEP Composite ie an unweighted index 3 se 2 TheDfths 2 uacempoitelder B, Ina memure of 0 aieret sacs fom lhe penile industries, ©. Users disorin tw eleiaion D. Allee above 3, Pease fin the Banks ‘The Dg Average ie (A) __ seni This eames it fen) the indus 4, Whi moving serge i Wiliam Gordon use in hielo for DeDyAe A tek 5 amo C sbeck Di dtcnz ie 5. Wiyistherelasontipberseen she ILA andthe Dj Uses of ovtloahed? (8 Beene deers work ver well Because teres ual locofexcterent ebewhere when they med Beeure GN ins beer ndcaor 6, Iie Vale Line Armed diverge negatel wth de SEP Composite, ‘A Boon tie ookouvTora deine when the SP conims witha trend break 2B Solidi, Bay he SeP becute ena superior elaesength = Bi Ignore he whole thing 7. Genera Motor (A Hosa babi cPlading the markt top and booms 1n2001 the Russel (A) conse of 58 percent of einen tock raseim he (B) The Rael (G)_=— conains ve nies Sue chips andthe Rell o) ‘Soften sued ws prom frlowesp nor, 9. Which ee mors comprehensive serage? A Tne ayia The SEP Compose 20. year were she Bf Ral renamed se Bf Teper? nis Bless ¢ 197 D. 155 i 18 Price: The Major Averages Answers 2. B.The SUP is weighted by eapialzaon 2. C-The DJA excludes wis and wansporu and eno therefores compost nde ‘The divergence warn thatthe echnical poston upect, bat Feira condmston frm the SEP in the for os ieevel {igeal before you can make final conchton tat he ode or = ‘eae 7. E-One ofthe restons GM lead at marke topes beau iti partly {nuestra senive sine the eel of aera 4 bg nen op Sinaneing ane letsngeanane taseere he pus to putehase ete. 8. Asoo 9. 10.6 United Sates: 1000;D. 200.19 Group Rotation Questions ‘Subjects to Be Covered Charette of gudipdriven groups Gharacertics of eringrarten gros “The inividual groups hal under iii: and earingsaten groupe 1, Since he buns eye moves rom an infaionary te defaonaty ar groupe sna to infaonny condone have tendeney to fend te marke Tne Bike 2. Which of he folowing sateen ire? {A Intaansensive groupe do well ven interes aes are detining '. Occasionally unustal fnmmensais fora group tl cvecice she 6. Eiliqniven groupe do well hen commodiy pies are ring sha . Nene the above. 8, Please itn he lak: Seek often betom outa the same tines the SEP Compose. but {hey tendo pain thei best relive performance mth Al of he ete. Elecic ules have tendency (8) othe SRP arte sope, 4. Wich ofthe folowing fll under the tern fluitirriven groups? ‘A. Sos paper chomlcl sed insure companies, B. Reales, computers and ol,ne . wens ©. Uies,wbacco, sof ern, and proper eal ners . None ofthe above ‘5. Which of he following fl uncer the erm of ean groupie A Mines, and chemicns 8 Sees reales ana pessoal cave Papers miner and ected: , Bewicuslivs, hfe ince, an retire . 6, le techni postion india sch favoring ineonsensive outs Oxo boy B Brokers lesurance D. None of te above “Fine marets peaking which groups are probly alee inte aan? 5 ow leew wster 3 ance compare 19 Group Rotation Answers, 4. B. ide detain or liguio-sensive groupe halen the market botoms not the nla ov casing Svoee group, 2. B Sometimes specifi change inthe fundamen il case tto rove outefveguene, A. Bod: Bead c tes only OK wo buya group when echnical pasion i poe, ‘This ull de cae when the envionment elasonay ut Motj 20 Time: Longer-Term Cycles Questions Subjects to Be Covered Knowledge of le lengths and names, Charteris oti Principe, eh as ummaion and arlaon Seasonal patere 2. Pete atch the alovng ake | © Hondrniet 5 Blvard Dewey E Jorph Schumpeter Edgubnrene Sh 2 Plemte illin the blanks the prentr the neces for pesto meen ‘ireeton anand aesordingh | .120 . Presefillinthe Mans: Prices moveinpesidic Mucsstions known 2 (A) <__, oe operate for pesos ranging om a ew dy to ‘many dandas Ar any pen moments numberof () A Aucling chras 3B, Record volume © Declining vhume . Rung velume 4. Whatley o happen nes inthe char below? A The price wilh B. The pce al deding © Ateting nnge DB. Nave ofthe toe 5, Which the norma siuacon 3B. Volume teats pce © elume omace shen pies detne D. allot the shove eatin as 6, tehe price rss and volume contac and then the prc fale and lume expand 1 This bear 1 Tht alo, This normal acon, D. Theres noindicaon of whether thi bullish or beast 7. When ally culminates in parabolic bowl vlume, ce Resting of tp B. Asign of exhaurdon an therfore the add favor 2 op Asignthaone more alt 3 new high on low solu shoul be expec D, None of hesbone22 ] Volume PrinciplesSe ed { | 136 ape 22 2, Be Most of the time his ina correct saterient However when the pce ies fom ling clinason fling volume thi ove, Shoe cling cinases ne normaly bul, ti repreens an excepon Als, find saosin the char wn te ng Price fling volume rule docs not war even tough ie te norm . 5. B. While nota pereetindieator cord volume nuralya rong and Felable gal 4B This because he prices faling unders end of sing volume, Mich ba bea chamccee * 5p. 6, A Ring prize and fling volume abnor and beaith, Sooo Seaning price and expanding vlune 17, B.A parabolic Blows normaly asocned wid # op Sic ite am cthatsdon charctersc it shighlh unlike tnt new igh wuld ve 23 Volume Indicators Questions Subjects to Be Covered Inverpeeing he ate of change af ‘The eho and interpeetdon of she Demand Index ‘he ssumpons underyng the elelasion othe Chan Money How Interpreting the Chaitin Money Flow (Contsedon and interpretation of the Arms Index 1. Aigh ceding ina volume ROGindicaes ‘A Abigh level of volume 3B. Anoverbougnt market An orerld marks D AandB 2. Whats kel to happen when both trendline in he felling char 1X The pce aly B Theprice wl fa The pce all move sideways, D, There snot information to make 2A A RD 23 Volume Indicators Answers A. ALAnighseading ete ndiatss igh lee of volume, This could Come daring ely ora Geline 2. B, When the pice fills and volume rie thi Bears140 or 3. G.Apashing inthe oxllxor indies» probable exhaunt volume, whi soften allowed ya ene seer 44 A. Volume ean aici wih price, tually eds it Rarely docs ‘elume ng the pice Ba 6, B. The Demand index, unlit the wlume ROCand oscar abeays rover inthe ume dvecion seine pice Bc. 9. D.All ofthe above are leginaenterpeineteeigues, but the strongest carat of hinder tai te pinup 10. . The OBV isnot an euclsor and doesnot enpesiencé ‘Sterbough/oveold conan Questions Subjects to Be Covered Methods ofA line consruton The concep of difsion nda and dhl in ‘The concep of seasonal momentum and Is ints The concept of net new highs The MeClelanceilsor and Summation Index 1, Whatare th waein whieh an A/D lin an be clap A By cumulring he daly ply a sances ny 3B. Byeumulang the alfrence beneensdwes ded by the number sf unchanged . bpeumulaing the aay cferene benseen tyne bighs sido A. Overboughi/overaé condition. memos 3 Drevgeneon 3 canbe contrac er yk nae enainn of componcnsteat mS nat RRO a RR Ta 142 s Before using any A/D ine fr compari purpes iti ft 1 Galate mE © Galtare winer moment D, Gheckto see be hac has a store doward Bae Pagel nthe a [Bread dta may be expres at an Adsance/Dedine (A) __or ale. Both forme maybe used tien ponve i nega OE ch desrpion tet danrbes ha the McClellan elton s ‘aleaed? ‘From adrancing le ecining aes BB Bycomparng simple moving serages €. Bycomparng wo ENA ofthe daly A/D ine Fors pec 1, Bpealeuasing a mocthed ROCof2n A/D line We i any ae core atement if the MeCeian exiles 1A The Suramation Index wilt be above tre 1B The Summadon index wl bering D. None of te above, Tae A/D in tends to en! the market at peal cau 2 Many ies ee nerr tense ae ner rater ea eles B. Market paricpant end lee confidence in smaller companies, ‘efor large one ane there ae more smal companies B. aang. In using the concep of esonal momentum, high and reversing B Spring Simmer Dra tine va Ad____indieator mesures the pteensiys ofa baer ‘Serer tht ae expesiencing = psise eae il inthe Was: Under the concep of exons momenta min decines ae samesme vided when (A) Les (8) {nea ofovdoter Tas kaowa ava (0) 1 on hie sa beter bell weather for he bread A The A/D line 2 ebm C The StP Compare D, The NASDAQ Compose. ‘The net new high daa should aap Be clea ha Sneek ‘iespen Pee fil in he banks: Secret dates tyson24 Breadth Answers 1. D. There are actualy several ther ways in wbich he ine can be 2. B. There are many way iterret A/D line such tending lations, pice per completions, snd MA eatovery, but he MOK, Common it dvergenes, bots negsve and pote. There ch ‘hing asa fevese pie pate, A tine B.oscilnton © ergences B.if ihe otelatori above ser, el ado the to for he Summation Indes nen enn that wl be rng Te index el foul be above or blow ero 8, D. Some, but net all A/D ines ave x couse in oa 11.4. fh B. summer © Indian D, sumer. 12.4, 18, B52 weeks has ben the raion nese, but here fenoreason ‘why ay reali ime pete cannot be uted 24.4 cumolave; 10* 25 Interest Rates and the Stock Market oso besa Questions Subjects to Be Covered ‘The elasonsip beoveen terest es and ei prices ‘The theesnepancitmble rule rede maretsectors 1. Which smoreimporant tan induence onthe economy and egy price B. Thelevl eflongiern tet, C The rat of ehange of sorts rats D. The tea enange of longterm see 2, Changesin the primary rend of shorter interest nes have led ccerystok marker boom since 198 Shue Greiner insramensrepetent competion for eu 3, Stor ae often bought on marge, and change in the cost of ‘taro afc buying ancl (© Changes in meres ats fe1s. cnn 2s 4 Whe aneverio he reo quesion acomplia indented in Please match he fling: (ream = 6) Tonge eee arkensmuent Sone meer 3, Rinna ofa year 3, Amaury often 10 year corless 2 6 Inemedine martes C. Amati faing beeen | 6 Pease in eae een funds, Sonth creda a month Pare all (mm arth te BIE Rha gresterinisene over secon an rer longiern (6) 2 Changes in he gold pice area perecndinor for peeing nee intend et 8. fa shorecerm oslatrfi reach an verboughs condlonevera lod ferent ons and cs concions ogy [AVA paman ball mare environment 3 Apiary bar market nvronmens Abe B. None ofthe above 9, The hreesepandstinble rule sates, ‘AvThatif the dzount rate ad been hed Te times the wp {Be vtock mares hs bees son expec equin prices mmesinch nunc & Thatif he dicount ae far ben rie te ne, the lock hat begun och forthe bul martin eer 1, Thatif he dacoune race hasbeen loweed thee dines, tock Drees are lik tumble 10. Pee nthe ans: ‘The tre main econ the US. bond market ae (4) Be ee 25 Interest Rates and the Stock Market Answers fe rareexcopdons sucha 1987 Sine thaws no aocaed tha ‘ecunon could be argued that te tlasonship cd ol ino te or, However the 187 crash did meet the mags qualfesion Rovntbearmastes 4, B. Changes inate si fect the conf capil and therefore alee corporat pois cect 5. AHBBEACHC 6, Ac money martes B Federal Reserve C ineet ie. 2. B Goa dicounsinfasonan endear 9. © Once he rae ha ben mised hes times the mathe: becomes vulnerable, butthead in each ele hae saves considera ‘choi sce the inauguration af the Fede Rese 10.4. us exempt: 8. export govemmentI os ta 26 Market Sentiment Questions Subjects to Be Covered Diferennting boven sy and lesemar groups of marie paripan Interred ftentment distort 1. Which of be fllonng end wo atin a manner contay ota of he paren 3 Trader € Specs . sae Alo ihe sbore F Cand 2, Why i probable that shor interest numbers have become tore 1s" Bech ofthe ig bl marks n the 98 a 980 1B Because of he advent of futures and eps bich nerenser, bivage opportuni D, Nose athe stove 3. Ashor imerent in vce of 18 i bay al A Tue lee1s2 Chote 25 5. Which of the flowing siemens ire? A The wend ofsendment an be)us important he eve B, Allentien: ingentor edt and therefore toa be ied sparingly Trendinenolaionsin sentiment indicators ocesonly ge good buyand sel signa D, None of the shoe E Asad, 6, Please Silin the bane ‘When sendiment indicators ar not avaiable tis psi to aubaite ‘m___— indicators ince ba sec eles mood changes in (aden ad investors = 7 Which it more keys oe the songs sig ‘Av As extremely lw Market Vane bond ul reading i bear market B. An exreme high Marke: Vane bond oul eaigg int bess mater ©. An extremely high Marke: Van bls bond reading in «boll 8. When delve of margin debt rots blow is 12th EMA hi cy. * Bulbs B Bearsh 9. An exreme reading in ie Marks Vine lich bond numbers is (ually svoced h A Athor o inermedar rang point 1B Apriman tending pone 20. Muwal fund ash/aet mis are A Sentimentindntrs 1B Flow affundsindiatons Dames 26 Market Sentiment Answers 43, B. The to be she case, but in ecent decades numbers wel in sce of 1 hae been seid 4: Adah leer weiter ae contrary indletr ‘5. E. When they o, iis aways a good idea wo getsome hind of rend «confirmation igha rom the pie fle 6, Moreau 7, B. Contatrend sigs ae wally more povetl than protend Signals Bear low number of ball) readings in bse mart do Bot necemaly generate song rally, wheres ge numberof ‘alsin a bear acter are lke to be fallowed 2 Seong desing ‘5. B. hen margin debi contting shinies lack of ‘confidence and beat 2. A Because his ia shoreieem indian itsignals les inpvtan Ceening pint 10, These ndiestors canbe we 3 ow of fund o sentimen inietor.= en wr ee 27 Applying Technical Analysis to Contrary _ Opinion Questions Subjects to Be Covered \Contan epinion define Fenonaiies who have writen about crowd psychology Steps in forming sconce opinion Wy itl aiel ogo coneey 3, Mens fl i be Banks ‘The euiding igh of imesenet contrarian spt ths the majo view"the contentions or eceved wadam=ahayrisong Rakoy a Is mation andjtig dons 3. Figing ot what une rnd this ©. Takings your tienes Determining when the cond eaches an extreme E.Fouing aerate seman: F # ADlandEEP ae i 186 Cope 29 8, Pease inte bani ‘Wen th (A) «__reacher an extreme, he gueson it not, Om bas 44. Pease math the falloving ate A. John B Macy 8 Ghats Humphrey € Leton ©, Schule DN 5. When you ee ser bulish cover ores nd the pie hat en sinc) oer te prev ear ae ob, 3 Ble {6 Which of ie towing are resins why iti if to goog? ‘A Because mow of aves neadvconforre, B. Theresa cerain comfort gined oy heeding the adie ofan caper Wetendso belie teesabishmen has the anew. D, Beene of teeing idee E Atchison « 27 Applying Technical Analysis to Contrary Opinion _ Answers ‘A. Dopma: Balin misprice, A. Crowd: B. whether: when: D bo ‘5. B. The row can sometimes nove to an extreme, wel yond fnyoned oldest expecations Therefore ni beer emake sre that ‘hur eontirmed bys eccl iga| KS 29 Mechanical Trading Systems Questions Subjects to Be Covered ‘sone and dindanage of mechanic ems ing poo performing stems 1. Mevhonieal sams ar wed aa subsite fo judgmencand 2 Whe steve dea beer atm? he at haa pefet wth hori daa wth one secur 1S One that ha ben onan prise but has isperine a fitoer many seers, lat has huge prof based on one or mo sigs ucsome othe avanages of wellsgned mechani remove abject 1 enable the trader to paripte in every worth move160 cap 29 4. Whatarethe diadranagesofsuiomated stems? ‘Ac Buctsng won necesany simulate what artaly would have happened. 1, Random evens can jeopardize badly conceived pute. . There il belong pends when te Best ten D Alefunestone 5. Ifa buy signals shen, bt there ene countering sl sem, what A earn to mach magn 1 These war nor propery once Tresptem hs not een ceiged preci, ~D. Preven wer not xtapaled Score eesing the martegnce 2 Ban, 6 you wade «proven and weldaigned tem and yo ee il of your api execting i tat he problem tii cbt Youd not nave the spade tage You i not make sure tat you hed cs capil ose the tort long nest during the ten peed Binge 1 Pee lin the nk ‘Tre worst sng oflee rom a pei op esi peaks known as Gepenea 8. Looting athe equ cures from thre diferent stems in the following charcsich ones keh ts eter he bee ela? one 161 whic semen arse? 1 you dont invent enough rales, te sample daa nor be ‘probate and weiner wl the eaime apples. 1, These ofthe drow isunimportancf the sem realy probate 6. Heyour tem tars outa big winner in reabine you know you've qurinade , Rone aft above. Using leverage wih mechanical sere wl ‘A Always resulta bigger gus for gsiems tation prtiably ‘E Eenggrte thers bth on te upside tnd downside . Depend onthe chronological sequence In which the gine and pie and downside29 Mechanical Trading Systems Answers164 Gant 29 6. B. Tis tine inthe folowing carthas a consstent ring end. Ais too sola and Cloves money ! XK 30 Technical Analysis of Global Markets Questions Subjects to Be Covered ‘he intrnauona year cle Ghote of Word Indenee ‘Appling bead incesor to the global equi scene 1. Which years representa botiom in ie year busines le? 2 197, 1075, 196, and 1884 'B 198), 1685, 1986 ana 1092 196,186,190, an 1995 . 1986, 1850, 1964 and 2808 The Ayer global stock ce A ‘Repent enact every yee Repent spovonimaty ery yen "Ha worked content well sine the 1600s ranted D. Bande AC Allouarhe move in the sine dzeton al he tne 5, ition indexes cannot be aed wih te Word Tex because there snot enough dt (©. The NSCIWorid Index he onl one worth ing D.ATBanac,166 cee 99 44 TReNSCI Wo Stock Iden weighted by make capiiion A The " B rae 5, Baud on th ext which re eptimat ayo nerpre dition Indeatorconsecea fora bases inca oun ndene? ‘A: Drerpene snl. Tendin ae > Siena a ris Technical Analysis ; of Global Markets i i i | I BM sepa sib eas and be inde oe ¢ Beinderwtt ag ao. aD 5. F-Relave selon wa not cused intext i 62.x 31 Technical Analysis of Individual Stocks Questions Subjects to Be Covered resp ages of oes Pengo tec Relating indicus act industy groupe sing aes of ent te ele rope ‘hen oak aren apy pe bli eee yo. ‘When the epposie circumstances are present he Mock nado be (Bo 2, Which tock best end themes tothe buhol proach? A Glas © Soest nigh beas B. Allefaneabove 5. Asset price wend F Cand170 5 ones 4 Stocks can be selected when the overall markt conons are right the group loos poste, end he indivdual ok loos stg greater he group Thsappoach weed be 5, When th secular tend ofthe eave strength ine eee, but the uptrend in the abate price end iil ntact the bess cee? ‘A Hold on un the secur rend forthe about price reve 1B Sel'and moe ino ash Provided the real market condtons are pose, sch to ‘Hoch vida pole saat and alate phe ene that are not Srereende . None of the shove % Looking: te following char it resonable rand ong lem AST yy igea aver BN 1Wuhe mache andindusy group have bo ured pos i ey ‘hat aome soc inthe group wl ouiperionm ihe othe bt its OR tebuyany ofthe Bre tere a1 8, A rao such asthe aluminum banks, nde that he eee as ‘moved von infasonay sage ‘A Ths means that it OX co buy ney eaders 'B, This means thats OK to buy ety lenders provided their technical condition eli © This means hat its OK to buy ley leader provided their techni conditions cound. , Earp and migeyeeleadort shold not be bough under any E Cana. 2. stock soverowned, should be mesial shored 3 Pike 10. When the stock mathe rallies off bear market low, itis eafe to bay Dine 3 Fae31 Technical Analysis of Individual Stocks Answers 2 A. OveromedsB,underctned. 8. E-The secular wend at for several busines oles andi more dominant san the primary rene bectne tats onge 4. Thetopown. 5, G.I: OR wo hold on un he solute price wend eenes, bot Bene resus ome fom thing ta tock wher he RS tend pose 6. A Deca the shorserm RST ha olated a downtcenlin and the Price as broken aboves year downtendie,176 3 c Candle char, 87-81, 95, ee lds, 9,98 counterattack ins, 69 a lds, 8, 91,95 nguling paucrs, 57-58, 95, [ling three meinog, 67 danmer, 68 ‘aramlformation, "8, 90-81, 98 plering ie, 85, 90,95 Tang three method, 8) san, 89 freee tops and bor 65 psde gap 89 wohme, windows, 90, 98 cath /aset ais, 152-188 enered average, 5-65 (encered moving averages, 59,68 ‘Glin Money Flow ndetor, 157 \Chande momentum exclatr (C0), 74-75, 78 ‘Chemical indusey NEAL? higroup, 5 (CMO (a Chande momen excatoe) CCommodies, 10,18 Consol Sores Ch, 28-20, 9 Cansolicsion broaening fematons 81,87 [Goninon break, 5,57 {Consary epinion eo, 155-157 ‘Contant, Corrective fan principe $5, 58 Coustratack lines (Dea! Sen), 8 Cree $38, Cromer 60, 65,78, 84 Gromds 15-187 (jee, 955187 D Dark cloud cover (abuse), 35,91, 05 ay hart gps ice 4, 44 Deal Sen (uni Des margin, 152 Decennil pacers 218 Deftaton, 1.117 Depth of movements, 1,57 Desig of svtomaed! em, 260 Dewey, Edvard, 118 Dison instr, 141-245, Directional movement indo (Din, 81-88, 65 Dis (eDiceonal moverient, Indies) Disbuton pattern, 29 Drergences, 663,84 complex &8 sepa, 65-06,71 Dogma, 55,187 Daiet. 93 Double botoms 28, 88, 486 Double gee 5-10 Doube toe 92 Dov Che 16 Dow Jones indus Anerage (ya), ur118 Dow Jones Rall Average, 12115, Dow ones Trangpreion aecrage Hactis For one iy eg, ow theory 15-17, 19 oncepand ene of, elopmenc of 5-16 Tian of 16-17, 18 E ae Exningeien groups, 11 rare at LU (ar Exponential moog ‘verge Engulng patterns (Tuam), E3808 Evrodaian 148-149 ‘Eausdon ending 54 58 "sponental moving avenge (Bas), 55,68, neme ings 6872 F Fabere ning 7475.79 Faure, broadening formato, Falling tcee ethos (Shin Banare Sanpoo Ondsckor), 88 ar pint, caret, 38,58, Faen Fonaed, a7 Federal Resene, 18-148 Sepa 8 ing patterns, $0, 33 Sayer ee 19,165 FFISE, 108,10 G caps 4144 Gary FEM, 1622 (General Motor, 22-118 (Cobalsiock marke 165-167 Gol ae 148 (Gordon, Wiliam, 121 ol, Edson, 10,104 reuprostion, i-t17 (Gy Sen (a eed ines) H amon, Wiliam Few. 18 Hammes (Taku) 68 arto) 88 86-91, 98 Hescandahoulee (863) pater, 8,85. 105. 105, 8, 29, 32-58, 98 Housing inst: 18 HAS patems (ar Hieseand Shoulders pater)