FIN555 CLASS ACTIVITY WEEK 13

The two primary tools of a technical analyst are:

• level of the market index and volume.

• economic indicators and level of the market index.

• price and volume.

• price and technical indicators.

Technical analysis differs from fundamental analysis in that technical analysis:

• is aimed at the market while fundamental analysis is aimed at individual stocks.

• is based on published market data and focuses on internal factors.

• focuses on the long-term trends of production.

• does not consider price and volume.

Which of the following is not true regarding the Dow Theory?

• 
  It is intended to forecast the start of a primary movement.

• 
  It does not forecast how long a movement will last.

• It has a very high success rate.

• It is subject to many criticisms.

Which of the following is not one of the three major variables to be decided by the investor in order to construct a moving average?

• 
  price used.

• time period.

• 
  weight to be used.

• type of moving average to be constructed.

The goal of the Dow theory is to

• identify head and shoulder patterns.

• 
  identify breakaway points.

• identify resistance levels.

• 
  determine changes in the primary, or major, movement of the market.
  

In order to measure “the market,” Dow constructed two indexes, which are:

(Choose two)

• Dow Jones Industrial Average

• Dow Jones Rail Average

• Dow Jones Airway Average

• Dow Jones Composite Average

According to Dow Theory, changes in the daily closing prices reflect the aggregate judgment and emotions of current and future stock market participants.

• True

• False

There are three market movements suggested by Dow Theory. These three movements are:

1. 1. _______ movement

2. 2. secondary movement

3. 3. minor movement

A support zone represents a:

• a concentration of demand

• level which a stock price cannot go below.

• concentration of supply.

• level which a stock price cannot go up.

A secondary reaction does not have to be a decline in a bull market or a bear market rally. It can also take the form of a sideways movement.

• true

• false