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Free CMT Association CMT-Level-II Practice Exam with Questions & Answers | Set: 3

Questions 21

What is the measuring objective for flags and pennants?

Options:
A.

There is a different measuring objective for each

B.

Flags fly at half mast and pennants are considered reversal patterns

C.

The move after the pattern will be equal to the move before the pattern

D.

Half the distance of the preceding move from breakout to the flag or pennant

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Questions 22

An evening doji star:

Options:
A.

Has a doji in the last position

B.

Has a doji in the middle position

C.

Is completely comprised of dojis

D.

Is completed by dojis leading out of the pattern

Questions 23

Which of the following is a diversification technique in trading?

Options:
A.

Trade multiple securities in markets with high correlation

B.

Stick to a single trading system

C.

Balance risk across multiple markets and trading systems

D.

All of the above

Questions 24

Interpret price action in the chart below, combined with takeaways from the SPX New High-New Low index:

Options:
A.

Confirmation between price action and indicator; the ongoing pullback can be bought.

B.

Divergence between price action and indicator; suggests exiting of long positions.

C.

Divergence between price action and indicator; can initiate shorts at current levels.

D.

Can initiate long positions at current price level; breadth bottomed out at the same level as the pullback in October 2014.

Questions 25

Which of the following BEST describes the rule of alternation?

Options:
A.

Downtrends follow uptrends

B.

Complex patterns follow simple patterns

C.

Price follows volume

D.

Prices alternate in Fibonacci sequences

Questions 26

In 3-box point and figure charts,

Options:
A.

A double-bottom and double top can be continuation patterns

B.

Only a double-bottom can be a continuation pattern

C.

Only a double-top can be a continuation pattern

D.

Neither can be continuation patterns. They do not exist in Point and Figur

Questions 27

Which of the following points represents a valid island reversal in the chart below?

Options:
A.

A

B.

B

C.

C

D.

None of the above

Questions 28

Which of the following is true of the three black crows' pattern?

Options:
A.

The color of the real bodies is of utmost importance to its significance

B.

It is continuation pattern

C.

The three candles do not have to be on consecutive trading periods

D.

When succes

Questions 29

Which of the following is a valid guideline in using technical analysis to make investment decisions among stock market sectors?

Options:
A.

Relative strength analysis allows for identification of the strongest and weakest sectors

B.

Charting tools such as trendlines and moving averages should not be employed with relative strength lines

C.

Sectors whose relative strength lines are just turning up after a downtrend should be sold

D.

This analysis does not hold for options or mutual funds due to the unique characteristics of these securities

Questions 30

When using the Bar/Candle method to portray volume what is the relationship defined between price and volume using this method?

Options:
A.

It has an indirect relationship between price and volume

B.

It has a direct relationship between price and volume

C.

It has no relationship between price and volume

D.

The price is dependent on the volume

Exam Code: CMT-Level-II
Certification Provider: CMT Association
Exam Name: CMT Level II Exam
Last Update: Jul 17, 2025
Questions: 262

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