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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Theory and History | 7% | - Behavioral Finance Principles - Evolution of Technical Analysis - Key Concepts in Market Analysis |
| Topic 2: Ethics and Professional Standards | 3% | - Standards of Professional Conduct - CMT Code of Ethics |
| Topic 3: Application of Technical Analysis | 10% | - Model Evaluation and Implementation - Risk Assessment and Planning - Asset Allocation Using Relative Strength - Chart Interpretation for Entry/Exit Decisions |
| Topic 4: Advanced Techniques | 40% | - Volatility Analysis and Measures - Statistical Analysis Methods - Systematic Trading Approaches - Cross-Asset and Intermarket Analysis - Risk Management Principles |
| Topic 5: Classical Techniques | 40% | - Chart Types and Construction - Price and Volume Cycles - Trend Analysis and Confirmation - Internal and External Technical Indicators - Chart Pattern Recognition and Interpretation |
Question 1
Which of the following is considered a reversal pattern in candlestick charting?
A. Falling three methods
B. Hanging man
C. Windows
D. Rising three methods
Question 2
From a contrarian's perspective, which of the following would be considered a bullish indicator?
A. CNBC is on the television at the local bar, and everyone is paying attention
B. A Business Week cover with a story on "The Death of Equities"
C. The vast majority of professional financial letter writers are bullish
D. Sales of investment books are increasingly dramatically
Question 3
Which of the following perfectly describes the pattern of a standard broadening formation with regards to pattern analysis?
A. The upper trend line goes upwards and must have two peaks, the latter lower than the former
B. The upper trend line goes upwards and must have two peaks, the latter higher than the former
C. The upper trend line goes upwards and must have a single peak
D. The upper trend line goes downwards and must have two peaks, the latter higher than the former
Question 4
When using a two moving averages (MA. system, which of the following rules can be utilized to generate a buy signal?
A. Buy when the faster moving average hooks the slower moving average from above.
B. Buy when the current price crosses above both moving averages.
C. Buy when the faster moving average hooks the slower moving average from below.
D. Buy when the faster moving average crosses the slower moving average from above.
Question 5
A trend based trading system where signals occur when the current high or low price exceeds the previous swing high or low price:
A. Swing breakout
B. N-day breakout
C. Point and figure
D. Simple moving average
Solutions:
| Question 1 Answer: B | Question 2 Answer: B | Question 3 Answer: A | Question 4 Answer: B | Question 5 Answer: A |
CMT Level 1 Exam
CMT Level III Exam
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