Elementary Flashcards
In a bull market, a ____ level is an area that price has difficulty breaking through to the downside.
Support
When price breaks through a resistance level, it could potentially become…
A support level
How many tops or bottoms does it take to confirm a trend line?
Three
When drawing trend lines, you should…
Never force them to fit the market
Describe a market’s behavior when a pair is trading within a channel?
Price trades within two parallel trend lines,
A descending channel is characterized by…
Lower highs and lower lows
Generally, the ___ of a channel is considered to be a ____ zone.
Bottom, Buy
When trading off support and resistance levels, you generally should…
Wait for price to bounce off the support/resistance level as confirmation that it is holding
When trading the break of support or resistance levels, the conservative way would be to…
Wait for price to retest the broken support/resistance zone then buy/sell
What do you call a candlestick pattern that has long upper and lower shadows and small real bodies?
Spinning Top
Who “discovered” the secret technique of candle stick trading?
Steve Nison
What would a candlestick with a white body represent?
Price closed above the open
What do long black candlesticks indicate?
Sellers were in control
What do you call a candlestick pattern that has a long lower shadow, with no upper shadow and price closing at its open price?
Dragonfly Doji
What do you call a candlestick pattern that closes significantly below its opening price and has no shadows?
Black Marubozu
A ____ is a bullish reversal pattern that forms during a down trend. It is characterized by a long lower shadow and normally has a white body.
Hammer
Which of the following is NOT a recognition criteria of a hanging man?
a. A long upper shadow that is about two or three times the length of the real body
b. The real body is at the upper end of the trading range
c. Little or no upper shadow
A long upper shadow that is about two or three times the length of the real body
What do you call a two candlestick pattern that indicates a strong down move may be coming?
Bearish engulfing
What do you call a two candlestick pattern that signals a reversal to the upside may happen?
Tweezer bottom
A ____ candlestick formation is a trend-reversal pattern that is found at the bottom of a downtrend. It has the following characteristics: The first candlestick is characterized by a strong bearish candlestick. The second candlestick should have a smaller body that reaches the midway point of the first candle. Third candlestick’s close should be above the high of the first candlestick
Three inside up
A Swing High is a candlestick with…
At least two lower highs on both the left and right of itself
Which of the following is not a Fibonacci retracement level?
a. 0.212
b. 0.382
c. 0.618
0.212
When the market is on an uptrend, you would ideally…
Go long (or buy) on a retracement at a Fibonacci support level
The Fibonacci retracement tool works best when the market is…
Trending
Fibonacci levels give you a _____ probability of success, but they _____work.
Higher, Don’t always
The Fibonacci tool should…
Be used in combination with other tools
One of the best ways of using the Fibonacci tool is…
To determine potential support and resistance levels
The Fibonacci tool goes well with…
Trend line analysis