CMT Level II Exam (CMT-Level-II) Practice Test

Questions # 31:

Which of the following is the BEST volume indicator for analysis of futures trading?

Options:

Open interest

Contract volume

Total volume

Breadth

Questions # 32:

_______uses the distribution of daily trading range to create a new indicator.

Options:

TRIX

Money Flow Index

True Strength Index

Intraday Intensity

Questions # 33:

What are common mistakes made by impatient traders?

Options:

Entering the market too soon

Exiting the market too soon

Abandoning well reasoned trading strategies due to adversity

All of the above

Questions # 34:

To calculate moving averages for a point-and-figure chart:

Options:

First, make a decision as to how many columns to average.

First, re-draw the chart as a 1X1 chart,

First, find the longest column, and count the number of filled boxes.

First, convert the chart to a conventional line chart.

Questions # 35:

In some point-and-figure charts, what is the actual representation of the new price recorded on the chart?

Options:

The first letter or the number of the month is plotted

The number of the month is plotted

The first letter of the month is plotted

The name or the number of the month is plotted

Questions # 36:

The stochastic oscillator was created utilizing which basic observation?

Options:

As prices decline, the trading range tends to narrow

Changes in volume precedes price movements

Existing oscillators were limited to a range of 0 to 100

As prices increase, prices tend to be closer to the upper end of the trading range

Questions # 37:

What is the position of the MTA Code of Ethics as it pertains to trading on inside information?

Options:

Under no circumstances is insider trading allowed

The Code of Ethics takes no position on insider trading

Insider trading which violates the laws/regulations of any governmental or regulatory agency is prohibited

Inside information may be disseminated but not acted upon

Questions # 38:

Which of the following are FALSE statements when describing the Chaikin Money Flow Index?

Options:

Gaps will not be recorded, as the index only uses the day high, day low, and closing price.

It suffers from the "drop off" effect, as it uses a simple moving average.

It measures deviations of price within two standard deviations of the range.

The index will rise above zero in an upward trend

Questions # 39:

Which of the following is an INCORRECT interpretation of the put-call ratio?

Options:

When options traders are bullish, call volume exceeds put volume

A very high ratio indicates an oversold market

A low ratio is considered a warning of an overbought market

When call volume exceeds put volume, this has bullish future implications for the market

Questions # 40:

A trend-based trading system where the trend is the average of a pre-determined number of previous days' (n) closing prices is:

Options:

Point and figure

Simple moving average

Linear regression slope

N-day breakout

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