Question on Theory and Practical Charts

1 / 25

Among the following options, which trade signal is considered the most reliable?

A new High or Low formed at weekly close

A new low formed at the weekly opening

A new high formed at daily close

A new high formed at the daily opening

2 / 25

A bullish divergence occurs when there's a _____ low in the price simultaneously with a _____ low in an oscillator

Lower, lower

Higher, higher

Higher, lower

Lower, higher

3 / 25

which of the following pair signals the end of a bear market.

Utility stocks surge higher and interest rate start rising.

Trading volume is very low and comodity prices have declined badly.

Utility stocks drop preciptously and trading volume is very high.

Small cap stocks surge higher and the VIX rises above 20.

4 / 25

Among the following, which type of trader possesses influence but lacks significant intelligence and market knowledge?

Large Speculators

Crowd

Hedgers

Arbitragers

5 / 25

Tick volume refers to

The number of contracts traded at each time interval.

The variation in open interest over a specific time interval.

The number of recorded price changes during a particular time interval.

The number of contract traded at each price tick.

6 / 25

Most profits are typically generated in markets characterized by __________ volatility.

Low

High

No

Medium

7 / 25

Understanding chart patterns requires careful analysis of ______

Breadth

Indicators

Moving Averages

Volume

8 / 25

Identify the statement that inaccurately describes call and put options

Exercising an option initiates a transaction between an investor and the company that issued the stock

A put option grants the owner the right to sell stock shares at a specified price

Call and put options are speculative bets on the future movement of a stock

A call option gives the holder the right to buy a predetermined quantity of shares of a stock at a specified price

9 / 25

What constitutes the set of momentum or Rate of Change indicators?

Investor Sentiment

The change in price

Investor psychology

The rate of change in price

10 / 25

Typically, a breakaway gap occurs when

Indicates a significant divergence signal.

Takes place during the accumulation phase of the market cycle.

Occurs at the end of an important price move.

Signals the beginning of a new trend.

11 / 25

A candlestick with a long upper shadow that emerges after a prolonged uptrend indicates

Buyers have lost momentum.

Sellers have lost momentum.

Both buyers and sellers have lose momentum.

The absence of clear dominance from either buyers or sellers.

12 / 25

Lower-priced securities generally exhibit a _____ Average True Range (ATR), while higher-priced securities typically demonstrate a _____ ATR.

Higher, higher

Lower, lower

Higher, lower

Lower, higher

13 / 25

If the stock market achieves a new high while the Advance/Decline (A/D) line fails to reach its peak, it suggests that

With fewer stocks participating, the rally may be approaching its conclusion.

The market has the potential to extend its upward movement.

With a substantial number of stocks participating, the rally may be nearing its end.

With a broad participation of many stocks, the rally may still have room to continue.

14 / 25

Volume tends to be ______ during a trading range but experiences a sharp _____ following a breakout

Rising, Decreases

Low, Shrinks

High, Increases

Low, Increases

15 / 25

During a consolidation phase, price action typically

Moves within clearly defined neutral boundaries on high volume

Attempts a breakout within a three-month timeframe

Chasing a breakthrough in three weeks

Trades within clear and stable ranges on low volume

16 / 25

Stock markets falls at time when

Neither the bid nor the ask should aggressively pursue the other.

Bid must chase the ask

Neither the bid nor the ask should actively pursue the other.

Ask must chase the bid

17 / 25

A bear trap occurs when

Prices break above a clear resistance level but then retreat below it

Prices close above a resistance level following sell signals

Prices bounce back above a broken support level post sell signals

Prices regain strength above a previously broken support level after sell signals

18 / 25

Most breakouts are deceptive and do not successfully indicate a new direction because

Market moves sideways about 80% of the time.

Market moves sideways about 60% of the time.

Market moves sideways about 40% of the time.

Market moves sideways about 1000% of the time.

19 / 25

What happens when the bid-ask spread becomes Equal to zero?

A tick appears on the chart

Execution of a sell order

Execution of a buy order

Any one of the above takes place.

20 / 25

A descending triangle has which of the following line

A horizontal support line

A horizontal resistance line

Sloping support and resistance lines

A sloping support line

21 / 25

MACD line is derived from which moving averages ?

It involves deducting the 26-day exponential moving average from the 12-day exponential moving average.

It entails subtracting the 12-day simple moving average from the 26-day simple moving average

It involves subtracting the 26-day simple moving average from the 12-day simple moving average

It includes subtracting the 26-day simple moving average from the 12-day simple moving average

22 / 25

How to draw an upward trend line

A descending slope formed by connecting two or more low points

A rising slope created by linking two or more high points

A descending slope created by connecting two or more high points

An upward slope created by connecting two or more low points

23 / 25

Which of the following statements about indicators is Correct?

All indicators can be used in all types of market in any time frames.

To identify patterns that are not a consequence of indicators but rather a result of holding loss-making positions.

One type of indicators cannot be used in other type of markets. They can only support the candlesticks charts.

Some indicators which were useful once cannot be used now and have become unessential.

24 / 25

The Death Cross describes the point when

The 50-day moving average crosses below the 200-day moving average.

Current price crosses below 50-day and 200-day moving averages.

The 50-day moving average crosses above the 200-day moving average.

Current price crosses above 50-day and 200-day moving averages.

25 / 25

Put Call ratio (PCR) is ________ indicator

Market sentiment indicator

Market momentum indicator

Market breadth indicator

External indicator for markets

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