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WorksheetsMoving Average, Envelope & Bollinger Bands
Total questions: 20
Worksheet time: 10mins
Which type of moving average is quick-moving and is good at showing recent price swings?
Simple Moving Average
Weight Moving Average
Exponential Moving Average
If price closes below the LOWER MA envelope, you should...
Wait for Retracement
Sell
Buy
A moving average envelope consists of...
A moving average and 2 envelopes
Two trend lines and a price channel
A moving average and 2 other lines
In calculating moving average envelopes, what do you do after selecting the number of time periods you wish to apply?
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Decide whether you want to use a simple or exponential moving average.
Set the percentage value you'd like to use for your envelopes.
Exponential Moving Average give ___ weight to the most recent periods.
more
less
equal
You get a clearer signal of whether the pair is trending up or down if you plot…
Two or more moving averages
Only one moving average
No moving averages
If the positioning of short-term moving averages relative to long-term moving average shows the DIRECTION of the trend, what does the spacing between the moving averages show?
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The difference in speed of moving averages
The strength of the trend
With the use of SMAs, we can tell whether a pair is trending up, trending down, or just ranging.
True
False
Maybe
Which type of moving average displays a smooth chart which eliminates most fakeouts?
20-Days SMA
200-Days SMA
20-Days EMA
200-Days EMA
To make a moving average smoother, you should get the average closing prices over…
Shorter period of time
Longer period of time
One problem with simple moving averages is that they…
Don't look at past price history
Operate with no delay
Are susceptible to spikes
The _____ the number of periods used when selecting which MAs to add to your chart, the more sensitive the moving average ribbon is to slight price changes.
Flatter
Shorter
Longer
The Bollinger bands indicator is an oscillating indicator that is used to measure:
Volatility
Momentum
Volume
Strength
In the chart below, the Bollinger bands indicator is shown. What does the line labelled 1 represent?
Expected price direction
Price
Simple moving average
Relative strength
Which of the following statements is true?
When the bands are far apart price is volatile
When the bands are far apart price is not particularly volatile
The Bollinger bands indicator has a default period setting of 20. What is likely to happen to the Bollinger bands if you change the period setting to 40?
The bands will appear to be smoother and less reactive to price changes
The bands will appear to be choppier and more reactive to price changes
In the chart below, which of the three points labelled 1, 2 and 3 would be the most appropriate to enter short when trading with this indicator?
1
2
3
The longer the period you use for the SMAs, the _____ it is to react to price movement.
simpler
faster
slower
What determines the direction of the envelopes?
The direction of the two lines
The closing price of the recent candlestick.
The direction of the moving average
Plotting different types of moving averages helps you see...
Short-term movement
Long-term movement
Both long-term and short-term movements
