Japanese Candlesticks Chpt 1 Intro

Question 1

Some technicians consider only a close above resistance a valid

Answer 1

buy signal so they have to wait until the close for confirmation.

Question 2

Technical analysis provides the only mechanism to measure ….

Answer 2

the “irrational” (emotional) component present in all markets.

Question 3

technicals are also an important component of disciplined trading. Discipline helps mitigate the nemesis of all traders, namely, ….. .

Answer 3

emotion

Question 4

Technicals can put objectivity back into the driver’s seat. They provide a mechanism to set entry and exit points, to set risk/ reward ratios, or stop out levels. By using them, you

Answer 4

foster a risk and money-management approach to trading.

Question 5

The markets communicate with us. We can monitor these messages by using

Answer 5

technical analysis

Question 6

Technicals make us step back and get a different and, perhaps, ……

Answer 6

better perspective on the market. “one can see the whole better when one sees it from a distance.”

Question 7

following the technicals is important even if you do not fully believe in their use. This is because, at times, the chart actions are …..

Answer 7

the major reason for a market move. Since they are a market-moving factor, they should be watched.

Question 8

the price action is the most direct and easily accessible method of seeing overall _________________relationships. There may be fundamental news not known to the general public, but you can expect it is ________________. Those who have advance knowledge of some market-moving event will most likely ________________until current prices reflect their information.

Answer 8

supply/ demand

already in the price

buy or sell

Question 9

For anyone seriously interested in technical analysis, I strongly recommend joining the MTA. Their web site is

Answer 9

www.mta.org.