Question 1

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

Options :

A :

They are opposite concepts

B :

Confirmation has a valid technical interpretation but in the case of divergence, no valid conclusion can be drawn

C :

Confirmation indicates a likely change in trend since all technical indicators are in agreement

D :

Divergence indicates continuation in trend since different technical indicators do not agree

Answer: A

Question 2

The Sharpe Ratio is defined as?

Options :

A :

(expected return plus the risk free interest rate) divided by the standard deviation of returns

B :

(expected return minus the risk free interest rate) divided by the standard deviation of returns

C :

(expected return divided by the risk free interest rate) divided by the standard deviation of returns

D :

(expected return times the risk free interest rate) divided by the standard deviation of returns

Answer: B

Question 3

Counterattack lines are formed when:

Options :

A :

a doji breaks a moving average

B :

a dumpling top fails with an abandoned baby pattern

C :

when opposite colored candles have the same close

D :

When same-colored candles have the same close

Answer: C

Question 4

According to the MTA Code of Ethics, what prohibitions MUST be adhered to after making a buy or sell recommendation?

Options :

A :

Allow adequate time for clients to act on recommendations before the analyst acts on the recommendation

B :

Analysts must give clients and their employer adequate time to trade, but the analyst-s family members are under no such restriction

C : Analysts may effect trades for their own account even if their employer has not had time to act on their recommendation

D : Insider trading activity is the subject of SEC regulations, therefore the MTA Code of Ethics is silent on this issue

Answer: A

Question 5

Which of the following is true of Bollinger Bands?

Options :

A :

The bands are based on the moving averages of prices

B :

The bands are based on moving averages of prices plus or minus a standard deviation factor

C :

When price equals the upper band it is considered bullish

D :

When prices are above the upper band they are considered to be in oversold territory

Answer: B

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