Study Guide for Technical Analysis Explained Fifth Edition, 5th Edition

14

MOMENTUM II: INDIVIDUAL INDICATORS

Questions

Subjects to Be Covered

RSI versus the ROC

Overbought/oversold lines for the RSI

Interpreting the RSI

The CMO versus the RSI and RMI

Calculating the trend-deviation indicator

Interpreting the MACD

The concept behind the construction of the stochastic

Differentiating between the %K and %D

1. Name some useful advantages that the RSI has over the ROC.

  i. It is smoother.

 ii. It is confined between 0 and 100.

iii. It is easier to compare the momentum of different securities.

iv. It always throws up actionable divergences.

 v. It is useful for zero crossovers.

A. i and v

B. i, ii, and iii

C. ii, iii, iv, and v

D. i, iv, and v

2. What are the default overbought/oversold bands for a 14-day RSI?

A. 80 ...