CMT LEVEL 1 EXAM QUE STIONS AND

CMT LEVEL 1 EXAM QUE STIONS AND

ANSWERS

Question : When analyzing long term price movements, it

could be helpful to use which type of chart?

• Candle chart
• Logarithmic chart
• Bar chart
• Point and figure chart

CORRECT ANSWER: b. Logarithmic chart

Reference: Dahlquist, Julie R., and Charles D. Kirkpatrick.

Technical Analysis: The Complete Resource for Financial

Market Technicians. Chapter 11.

Question : Which of the following would MOST likely be a

continuation pattern?

• Engulfing pattern
• Head and shoulders
• Double bottom
• Flag

CORRECT ANSWER: d. Flag

Reference: Edwards, Robert D. and Magee, John, Technical

Analysis of Stock Trends, 9th Edition. Chapter 11.

Question : Which of the following would NOT be considered

a support level?

• Previous high
• Previous low
• Trading range
• All the above are considered to be support levels

CORRECT ANSWER: d. All the above are considered to

be support levels

Reference: Edwards, Robert D. and Magee, John, Technical

Analysis of Stock Trends, 9th Edition. Chapter 13.

Question : According to Robert Rhea's hypotheses:

• The primary trend is inviolate

II. The averages discount everything III. Dow Theory is not infallible IV. Dow Theory is predictable

• I and II
• I and III
• I, II, and III
• I, II, III, and IV

CORRECT ANSWER : c. I, II, and III

Reference: Dahlquist, Julie R., and Charles D. Kirkpatrick.

Technical Analysis: The Complete Resource for Financial

Market Technicians. Chapter 6.

Question : For a breakout or breakdown from a triangle to be

considered valid it should occur NO MORE than _______ of the distance to the apex from the beginning of the pattern?

• One-half
• Two-thirds
• Three-quarters
• Five-sixths

CORRECT ANSWER: c. Three-quarters

Reference: Dahlquist, Julie R., and Charles D. Kirkpatrick.

Technical Analysis: The Complete Resource for Financial

Market Technicians. Chapter 15.

Question : What is indicated when Bollinger Bands narrow?

• A stock is ready for a rally
• A stock is ready for a decline
• A stock's volatility has increased
• A stock's volatility has decreased

CORRECT ANSWER: d. A stock's volatility has decreased

Reference: Dahlquist, Julie R., and Charles D. Kirkpatrick.

Technical Analysis: The Complete Resource for Financial

Market Technicians. Chapter 14.

Question : In the Dow Theory, the MOST important price is

the

• Open
• High
• Low
• Close

CORRECT ANSWER: d. Close

Reference: Dahlquist, Julie R., and Charles D. Kirkpatrick.

Technical Analysis: The Complete Resource for Financial

Market Technicians. Chapter 6.

Question : Which is/are considered important in determining

the validity of a trendline break?

• Time
• Price
• Volume
• All of the above

CORRECT ANSWER: d. All the above

Reference: Dahlquist, Julie R., and Charles D. Kirkpatrick.

Technical Analysis: The Complete Resource for Financial

Market Technicians. Chapter 13.

Question : Which BEST characterizes continuation patterns?

• There is sideways price action