Trading OnLine Self-Evaluation Test

1. What is a “Head and Shoulders” in technical analysis?

a chart pattern that indicates a reversal trend

price volatility indicator

a pattern that can only present itself at the end of an upward trend

a specific chart formation that predicts a bullish-to-bearish trend reversal

2. The average true range (ATR) is a technical analysis indicator that measures:

volatility caused by gaps and limit up or down moves

price direction

asset volatility

trend strength

3. Heikin Ashi chart is:

a candlestick chart in which data is pre-processed

a stock chart

a histogram of Japanese candles

a monochrome candlestick chart

4. What do you mean “an operation had a 20% drawdown”?

as a result of that operation the capital has undergone a negative oscillation of 20%

does not at the end preclude a gain

the margin fell by 20%

we close with a 20% loss

5. What can the horizontal line represent in the chart?

Trading OnLine Self-Evaluation Test - Figure Line — Trading OnLine Self-Evaluation Test – Figure Line

the average of the values

the trend line of the chart

both a support and a resistance

a resistance

6. Are the leverage and the margin related to each other?

Yes, they are directly proportional

No, they are not

Yes, they are inversely proportional

Leverage = 1 /Margin Requirement

7. To calculate the simple moving average at twenty days (SMA20), we must:

add the values of the last ten days and multiply the result by ten

add the values of the last twenty days and divide the result by twenty

assign the same importance to each individual value

add the values of the last twenty days and multiply the result by twenty

8. What data is required to draw a candlestick?

Open and Close prices and Volumes

O,H,L,C i.e. Open, High, Low, Close prices

volumes are sufficient

4 values of the prices of the session

9. Which of the following is a complete stock chart?

Trading OnLine Self-Evaluation Test - Figure Chart A

Trading OnLine Self-Evaluation Test - Figure Chart B

Trading OnLine Self-Evaluation Test - Figure Chart C

Trading OnLine Self-Evaluation Test - Figure Chart D

10. In the following chart of the closing prices of a financial asset there are also two 20 day moving averages: SMA20 and EMA20. What is the Exponential Moving Average (EMA) chart?

Trading OnLine Self-Evaluation Test - Figure EMA — Trading OnLine Self-Evaluation Test – Figure EMA

the line closest to the blue price line

the continuous red line

neither of the two previous lines

the black dotted line

11. In the following chart of the closing prices of a financial asset there are also two 20-day moving averages, one simple and one centered. What is the Centered Moving Average (CMA) chart?

Trading OnLine Self-Evaluation Test - Figure CMA — Trading OnLine Self-Evaluation Test – Figure CMA

the red line continuous

the line that starts on the day 10

the sum of the two lines

the black dotted line

12. ADX (Average Directional Movement Index) is a technical analysis oscillator (between 0 and 100) and is used to:

indicate a weak trend for values < 20 and strong for values >40

find the direction of a trend

measure the strength of the directional movement of a trend

detecting a gap

13. What are Pivot Point?

Price values indicating only the supports

Price values indicating support and resistance levels

Price values obtained from the maximum, minimum and closing price in the previous trading period

Indicators to determine possible closing values for the next session

14. Moving Average Convergence Divergence (MACD) is a dynamic indicator that shows the relationship between two moving averages of a security’s price. In particular it is:

the ratio between a long-term EMA and a short-term EMA

the ratio between a 26-period SMA and a 12-period SMA

the difference between a 26-period EMA and a 12-period EMA

the difference between a long term EMA and a short term EMA

15. If you set an order with Stop Loss, Stop Limit or both:

you want to limit losses

The position can always be closed when you want as long as the market is open

to close the position you need wait until one of the two levels is reached

None of the above

16. RSI is an oscillator between 0 and 100. What does the following chart mean?

Trading OnLine Self-Evaluation Test - Figure RSI — Trading OnLine Self-Evaluation Test – Figure RSI

a horizontal trend line between levels 30 and 70 allows better identification of extremes when there is a strong trend

movements above the horizontal line of 70 are of oversold, those below the line of 30 of overbought

movements above the horizontal line of 30 are overbought

movements above the horizontal line of 70 are of overbought, those below the line of 30 of oversold

17. What is a long position?

a trading strategy that speculates on the decrease in a stock or other securities price

a bullish market view

the purchase of an asset with the expectation that its value will increase

a strategy that should only be undertaken by experienced traders

18. %K is the “slow” stochastic oscillator, D% the “fast” stochastic oscillator. In the following chart, %K is the continuous line and %D the dashed line. Which is correct?

Trading OnLine Self-Evaluation Test - Figure STOCHASTIC — Trading OnLine Self-Evaluation Test – Figure STOCHASTIC

%D = 3-period moving average of %K

%D = %K

%D is delayed compared to %K

there is no %D chart

19. Using a leverage of 10 to 1 (10:1), I can:

invest $1,000 with an initial capital of $100

buy 10 CFDs

buy a financial asset for an amount greater than the capital held

invest $1,000 with an initial capital of $10

20. Which technical analysis indicators are in the following chart?

Trading OnLine Self-Evaluation Test - Figure INDICATOR — Trading OnLine Self-Evaluation Test – Figure INDICATOR

Bollinger bands

A simple moving average (SMA), Bollinger Upper Band and Bollinger Lower Band

A channel formed by support and resistance

A simple moving average (SMA)

Question 1 of 20

Note: This test was born from an idea of the authors of the book and all the questions present and their evaluation are the result of their personal experience as trainers. As such, this test has the sole and exclusive informal and confidential value and can in no way be taken as a reference as well as having no legal value.

Trading OnLine Self-Evaluation Test

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