Reading 12: Technical Analysis LOS a习题精选 2010, following, technical, likely

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Session 3: Quantitative Methods: Application
Reading 12: Technical Analysis

LOS a: Explain the underlying assumptions of technical analysis.

Which of the following is least likely an underlying assumption of technical analysis?

A) Value and prices are determined solely by supply and demand.

B) Markets are weak-form efficient.

C) Security prices and market levels move in trends that persist for long time periods.>

Technical analysis assumes that markets are not weak-form efficient. The other three choices are assumptions of technical analysis, along with the fourth assumption that supply and demand is driven by both rational and irrational factors.

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One of the underlying assumptions of technical analysis is that supply and demand is driven by:

A) rational behavior during calm markets and irrational behavior during volatile markets.

B) both rational and irrational behavior.

C) rational behavior only.

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Successful technical analysis assumes both rational and irrational behavior during all market conditions.

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One of the assumptions of technical analysis is:

A) all analysts have all current information.

B) supply and demand are driven by rational and irrational behavior.

C) the market is efficient.

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The market is driven by rational and irrational behavior.

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Technicians believe that the speed at which information is impounded into prices is:

A) instantaneous.

B) slow.

C) very fast.

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For prices to move in trends, information must be absorbed slowly, according to technicians.

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Two basic assumptions of technical analysis are that security prices:

A) move in trends that persist for long periods of time, and liquidity is provided by securities dealers.

B) adjust rapidly to new information, and market prices are determined by the interaction of supply and demand.

C) move in trends that persist for long periods of time, and market prices are determined by the interaction of supply and demand.

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Other assumptions of technical analysis include: values, and thus prices, are determined by supply and demand, supply and demand is driven by both rational and irrational behavior, and while the cause for changes in supply and demand are difficult to determine, the actual shifts in supply and demand can be observed in market price behavior.

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Which of the following statements regarding the speed at which analysts believe stock prices reflect new information is most accurate?

A) Followers of the efficient market hypothesis believe prices adjust quickly to new information.

B) Technicians believe that prices adjust quickly to new information.

C) Both technicians and followers of the efficient market hypothesis believe prices adjust quickly to new information.

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Technicians believe that the reaction is slow. Followers of the efficient market hypothesis believe that the reaction is quick.

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Which of the following statements about technicians is least accurate? Technicians believe:

A) market value is determined by supply and demand.

B) their job is to detect the beginnings of trends, not to predict them.

C) price adjustments occur rapidly in response to new information.

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Technical analysts believe that the market reacts slowly to new information, so that prices reflect news gradually.

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A basic assumption of technical analysis in contrast to fundamental analysis is that:

A) security prices move in patterns, which repeat over long periods.

B) a stock's market price will approach its intrinsic value over time.

C) aggregate supply of and demand for goods and services are key determinants of stock value.

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The difference between fundamental analysts, technical analysts, and efficient market analysts is the speed at which these analysts believe news is impounded into prices.  Technicians believe the reaction is slow, fundamentalists feel prices adjust quickly, and efficient market hypothesis analysts feel it happens almost instantaneous.

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According to a technician, stock prices tend to move:

A) in trends that persist.

B) in an advance-decline series.

C) randomly.

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Other assumptions of technical analysis include: values, and thus prices, are determined by supply and demand, supply and demand is driven by both rational and irrational behavior, and while the cause for changes in supply and demand are difficult to determine, the actual shifts in supply and demand can be observed in market price behavior.

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Which of the following is NOT a basic assumption of technical analysis?

A) Security price trends persist for long periods of time.

B) Market prices are set by supply and demand forces.

C) Liquidity is provided by securities dealers.

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The fourth assumption of technical analysis is that while the cause for changes in supply and demand are difficult to determine the actual shifts in supply and demand can be observed in market price behavior.