Question 1

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

Options :

A :

Divide the current prices by a moving average of those prices

B :

Create an oscillator that plots a standard deviation of the period lows

C :

Apply volume weighting to both high and lows in the data

D :

Plot a linear regression line through the data midpoin

Answer: A

Question 2

Which of the following is one of the advantages of computerized trading systems?

Options :

A :

Computerized trend following systems are profitable in all types of markets

B :

Computerized systems improve the interpretation of complex trading patterns

C :

Computerized trading systems remove the human emotion element

D :

All of the above

Answer: C

Question 3

Which of the following is the BEST volume indicator for analysis of futures trading?

Options :

A :

Open interest

B :

Contract volume

C : Total volume

D : Breadth

Answer: C

Question 4

Which of the following point and figure trading techniques limits risk compared to more basic trading rules?

Options :

A :

Buy or sell as soon as a new column is created on the chart

B :

Close out your trade on the second reversal back in the direction of the original signal

C :

Take small consistent profits, but allow large, windfall profitable positions to run

D :

Buy or sell on pullbacks after initial trade signal

Answer: D

Question 5

Which of the following are the three basic tenets of Elliott Wave Theory, in the CORRECT order of importance?

Options :

A :

Price, momentum and volume

B :

Price, pattern and volume

C :

Waves, alternation and reversals

D :

Pattern, ratio and time

Answer: D