Technical Analysis Quiz (Beginner)

Welcome to your Beginner’s Technical Analysis Quiz

What is the primary focus of technical analysis in trading?

A) Evaluating a company's financial statements

B) Analyzing historical price and volume data to predict future price movements

C) Assessing macroeconomic trends like GDP growth

What does a "candlestick" represent in technical analysis?

A) A type of moving average used to smooth price data

B) A chart element showing the open, high, low, and close prices for a time period

C) A measure of market volatility

What is a "support level" in technical analysis?

A) A price level where a stock tends to stop falling due to buying interest

B) A price level where a stock faces increased selling pressure

C) The average price of a stock over a period

Which indicator measures the strength of a price trend?

A) Relative Strength Index (RSI)

B) Moving Average Convergence Divergence (MACD)

C) Bollinger Bands

What does a "head and shoulders" pattern typically signal?

A) A continuation of the current trend

B) A potential reversal from an uptrend to a downtrend

C) A period of low market volatility

In technical analysis, what is a moving average used for?

A) To predict exact price points for entry and exit

B) To smooth price data and identify trend direction

C) To measure a company's intrinsic value

What is the purpose of Bollinger Bands in technical analysis?

A) To measure the speed of price changes

B) To indicate potential overbought or oversold conditions based on volatility

C) To calculate a stock’s dividend yield

What does a "golden cross" signify in technical analysis?

A) A bearish signal when a short-term moving average crosses below a long-term moving average

B) A bullish signal when a short-term moving average crosses above a long-term moving average

C) A neutral signal indicating market consolidation

What does the term "overbought" mean in technical analysis?

A) A stock price that is too low due to excessive selling

B) A stock price that has risen too quickly and may be due for a correction

C) A stock with low trading volume

What is the significance of high trading volume in technical analysis?

A) It confirms the strength of a price movement or trend

B) It indicates a stock is undervalued

C) It predicts a company’s future earnings