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CMT Association CMT Level II Sample Questions:
1. Which of the following is the best combination which results in respect to the volume and pullback in Diamond Top pattern?
A) The best mix is when there is a downward breakout on less than normal breakout rate and with few pullbacks
B) The best combination is when a downward breakout happens on an under-average amount of breakout with no pullback
C) The best combination is when there is an upward breakout on less than normal breakout volume with no pullback
D) The best combination is when there is a downward breakout at an above-average breakout rate with few pullbacks
2. Which of the following is true of moving average construction?
A) The simple moving average is the geometric mean of previous prices
B) A shorter term moving average more closely tracks price action
C) The linear weighted average addresses the problem of including only the price action covered by the length of the average itself
D) In the exponential moving average more weight is given to volume on higher volume days
3. What of the following could be utilized in a computerized trading system to improve the performance of Wilder's Parabolic System?
A) Average divergence index
B) Stops
C) Directional movement index
D) Trend lines
4. Which of the following is true of W.D. Gann's trading techniques?
A) His work is valid for equities but does not apply to commodities
B) Gann's work is an advanced interpretation of point and figure charts
C) When price meets time, a change is imminent
D) Gann used 10%, 20%, 30% and 40% as his key resistance and retracement levels
5. Which of the following would be a valid trading interpretation of head and shoulder chart patterns?
A) Buy on the first rally after the neckline is penetrated
B) Buy when the head forms a higher high
C) Buy when the right part of the head is forming
D) Sell when the right shoulder penetrates the neckline
Solutions:
| Question # 1 Answer: B | Question # 2 Answer: B | Question # 3 Answer: C | Question # 4 Answer: C | Question # 5 Answer: D |




