Technical Analysis Basics MCQs

1. Technical analysis is primarily concerned with:
(A) Company fundamentals
(B) Past price and volume data
(C) Government policies
(D) Tax structures

2. The main assumption of technical analysis is:
(A) Markets are random
(B) Price discounts everything
(C) Prices are fixed
(D) Investors are always rational

3. Which chart is most commonly used in technical analysis?
(A) Pie chart
(B) Bar chart
(C) Candlestick chart
(D) Flow chart

4. Support level is defined as:
(A) Price level where demand is strong enough to stop decline
(B) Price level where supply exceeds demand
(C) Maximum profit point
(D) Break-even point

5. Resistance level is defined as:
(A) Price level where supply prevents further rise
(B) Price where demand is highest
(C) Breakout point
(D) Base price of IPO

6. Trendlines in technical analysis are used to identify:
(A) Tax policies
(B) Market direction
(C) Dividend payouts
(D) Monetary policy changes

7. Moving averages are used to:
(A) Predict government budgets
(B) Smooth out price fluctuations
(C) Calculate company profits
(D) Measure GDP

8. A “Golden Cross” occurs when:
(A) Short-term moving average crosses above long-term moving average
(B) Long-term moving average crosses above short-term moving average
(C) Prices fall sharply
(D) Prices remain constant

9. A “Death Cross” indicates:
(A) Bullish signal
(B) Bearish signal
(C) Neutral trend
(D) Stable economy

10. RSI stands for:
(A) Relative Stock Index
(B) Relative Strength Index
(C) Real Stock Indicator
(D) Risk Sensitivity Indicator

11. RSI above 70 indicates:
(A) Oversold market
(B) Overbought market
(C) Bearish trend
(D) Stable trend

12. RSI below 30 indicates:
(A) Oversold market
(B) Overbought market
(C) Neutral market
(D) Stable economy

13. MACD stands for:
(A) Market Average Control Data
(B) Moving Average Convergence Divergence
(C) Market Analysis and Chart Data
(D) Maximum Average Calculation Division

14. Bollinger Bands measure:
(A) Price volatility
(B) Company profits
(C) Tax rates
(D) Exchange rates

15. Candlestick with a small body and long shadows is called:
(A) Doji
(B) Hammer
(C) Engulfing
(D) Shooting star

16. A Hammer candlestick usually signals:
(A) Continuation of downtrend
(B) Potential bullish reversal
(C) Continuation of uptrend
(D) Market crash

17. A Shooting Star candlestick signals:
(A) Bullish reversal
(B) Bearish reversal
(C) Neutral trend
(D) Economic expansion

18. Volume in technical analysis represents:
(A) Market capitalization
(B) Number of shares traded
(C) Dividend payout
(D) Government tax

19. High trading volume confirms:
(A) Weak price move
(B) Strong price move
(C) Tax impact
(D) Dividend growth

20. Chart patterns are used to identify:
(A) Past profits
(B) Future price movements
(C) Inflation
(D) GDP growth

21. Head and Shoulders pattern is considered:
(A) Bullish continuation
(B) Bearish reversal
(C) Neutral pattern
(D) Government signal

22. Inverse Head and Shoulders pattern indicates:
(A) Bearish reversal
(B) Bullish reversal
(C) Neutral trend
(D) Sideways market

23. Double Top pattern usually indicates:
(A) Continuation
(B) Reversal downward
(C) Stable prices
(D) New IPO

24. Double Bottom pattern usually indicates:
(A) Bullish reversal
(B) Bearish continuation
(C) Neutral movement
(D) Stable prices

25. Cup and Handle pattern signals:
(A) Bearish breakout
(B) Bullish breakout
(C) Neutral breakout
(D) Sideways market

26. Ascending triangle is usually:
(A) Bullish pattern
(B) Bearish pattern
(C) Neutral pattern
(D) Reversal pattern

27. Descending triangle is usually:
(A) Bullish
(B) Bearish
(C) Neutral
(D) Random

28. Symmetrical triangle indicates:
(A) Continuation with breakout either side
(B) Stable trend
(C) Neutral always
(D) Market crash

29. Gaps in charts represent:
(A) Areas where no trading occurred
(B) Sudden dividend payout
(C) Taxation changes
(D) Stable prices

30. Breakaway gap indicates:
(A) Start of new trend
(B) End of trend
(C) Neutral prices
(D) Dividend declaration

31. Exhaustion gap signals:
(A) Continuation
(B) End of current trend
(C) New IPO
(D) Neutral phase

32. Oscillators are used to:
(A) Measure momentum
(B) Fix tax rates
(C) Predict dividends
(D) Evaluate GDP

33. Stochastic indicator measures:
(A) Closing price relative to price range
(B) Dividend payout
(C) Company assets
(D) Economic growth

34. Fibonacci retracement levels are used to identify:
(A) Support and resistance levels
(B) Company fundamentals
(C) Taxation
(D) Inflation rates

35. The most common Fibonacci levels are:
(A) 23.6%, 38.2%, 61.8%
(B) 10%, 20%, 30%
(C) 50%, 75%, 100%
(D) 15%, 25%, 35%

36. Overbought conditions suggest:
(A) Prices may fall soon
(B) Prices may rise further
(C) Prices are stable
(D) Economy is growing

37. Oversold conditions suggest:
(A) Prices may rise soon
(B) Prices may fall further
(C) Prices remain constant
(D) Prices collapse

38. Divergence in indicators means:
(A) Indicator and price moving in opposite directions
(B) Indicator and price moving together
(C) No relationship
(D) Neutral trend

39. Candlestick analysis originated in:
(A) USA
(B) Japan
(C) UK
(D) India

40. Technical analysts believe history:
(A) Never repeats
(B) Repeats itself in patterns
(C) Cannot be studied
(D) Is irrelevant

41. The time frame for intraday technical analysis is usually:
(A) Weekly
(B) Monthly
(C) Daily or hourly charts
(D) Yearly

42. Moving Average Crossover strategy is based on:
(A) Short-term vs long-term average interactions
(B) Taxation
(C) Dividend yield
(D) Profit growth

43. Point and Figure charts are based on:
(A) Price movement only
(B) Volume
(C) Time
(D) Government data

44. Dow Theory is considered:
(A) Foundation of technical analysis
(B) Company financial analysis
(C) Insurance principle
(D) Tax framework

45. Dow Theory identifies how many types of trends?
(A) 2
(B) 3
(C) 4
(D) 5

46. Which of the following is NOT a type of chart pattern?
(A) Continuation pattern
(B) Reversal pattern
(C) Neutral pattern
(D) Taxation pattern

47. A bullish engulfing pattern signals:
(A) Bullish reversal
(B) Bearish reversal
(C) Continuation
(D) Sideways market

48. A bearish engulfing pattern signals:
(A) Bullish continuation
(B) Bearish reversal
(C) Neutral move
(D) Stable trend

49. Technical indicators are broadly classified into:
(A) Trend-following and momentum indicators
(B) Tax and profit indicators
(C) Dividend and asset indicators
(D) Market cap indicators only

50. The main limitation of technical analysis is:
(A) It cannot predict fundamentals
(B) It guarantees profits
(C) It is irrelevant for trading
(D) It always fails