CMT-Level-II Practice Questions

A.  

In the exponential moving average more weight is given to volume on higher volume days

B.  

The simple moving average is the geometric mean of previous prices

C.  

The linear weighted average addresses the problem of including only the price action covered by the length of the average itself

D.  

A shorter term moving average more closely tracks price action

A.  

It has an indirect relationship between price and volume

B.  

It has a direct relationship between price and volume

C.  

It has no relationship between price and volume

D.  

The price is dependent on the volume

A.  

It centers on the premise that systemic risks in the financial markets can be diversified away.

B.  

It is a 45 degree line plotting possible risk versus return

C.  

It is a plot of the highest possible returns obtainable over a series of risk levels

D.  

It is unrelated to the risk free rate

A.  

First day of the week

B.  

Day before a holiday

C.  

Triple witching days

D.  

Summer days

A.  

Meeting margin calls

B.  

Not utilizing stops

C.  

Not getting sidetracked by single, counter-trend news events

D.  

Most valid buy signals in trading systems occur in the opposite direction of the prevailing trend

A.  

Point and figure

B.  

Simple moving average

C.  

Swing breakout

D.  

N-day breakout

A.  

Indicators do not take into account trading costs

B.  

Indicators optimized for the past often do not work in the present

C.  

Indicators are frequently so complex to create as to be of little use in making trading decision

D.  

Indicators usually give conflicting trading advice

A.  

RSI declines below its lower reference line and then rallies above it.

B.  

RSI rises above its upper reference line and then crosses below it.

C.  

RSI crosses beneath the midpoint (50 level).

D.  

RSI crosses above the midpoint (50 level).

A.  

keeping the policy change within the firm.

B.  

keeping the policy change within the firm and existing clients.

C.  

updating disclosures when the policy change is implemented.

D.  

requiring Smith to obtain permission from each client prior to implementation of the new policy.

A.  

The first day has a very long real body and the second day has a very short real body

B.  

The pattern appears after a consolidation pattern

C.  

There is heavy volume on the first day of the engulfing pattern

D.  

None of the above