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Free CMT Association CMT-Level-II Practice Exam with Questions & Answers | Set: 8

Questions 71

What is the specific name given to the normal distribution for having special characteristics?

Options:
A.

Center limit theorem

B.

Histogram

C.

Central limit theorem

D.

All of the above statements

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Questions 72

Which of the following are true of the concepts of divergence and confirmation in technical analysis

Options:
A.

They are opposite concepts

B.

Confirmation has a valid technical interpretation but in the case of divergence, no valid conclusion can be drawn

C.

Confirmation indicates a likely change in trend since all technical indicators are in agreement

D.

Divergence indicates continuation in trend since different technical indicators do not agree

Questions 73

What is the importance of time in interpreting the saucer and peak patterns?

Options:
A.

Longer time periods increase the signaling importance of saucers but not of peaks

B.

Saucer bottoms are more valid when they form over a short time period

C.

Long time periods between market peaks and troughs reduce the potential for a market reversal

D.

Longer formation time periods increase the signaling importance of both saucers and peaks

Questions 74

A technical analyst was at a convention in which a long-term point and figure stock chart was being discusseD. He noticed that low-price action did not appear as active as high-price action on the chart. One suggestion the technical analyst could provide, to clear up this apparent distortion, would be to:

Options:
A.

Change the charting scale to logarithmic

B.

Increase the time frame on the chart

C.

Change the scale to arithmetic

D.

Add the daily opening prices to provide a more visual benchmark of price changes

Questions 75

Which of the following is true of moving averages?

Options:
A.

Moving averages provide the most valid trade signals in sideways markets

B.

Moving averages provide the most valid trade signals in trending markets

C.

Moving averages always provide more valid trade signals than oscillators

D.

Oscillators always provide more valid trade signals than moving averages

Questions 76

How would one improve a trading system utilizing band penetrations as trading signals which is giving too many unprofitable trade signals?

Options:
A.

Narrow the bands

B.

Widen the bands

C.

Utilize a shorter time horizon

D.

Utilize stop loss orders

Questions 77

Which of the following statement is not true about the Diamond Top with regards to pattern analysis?

Options:
A.

It is a profitable pattern

B.

It consists of a combination of a broadening pattern and a symmetrical triangle

C.

It occurs at the top of a very sharp upward rise in prices

D.

It is not rare at price bottoms

Questions 78

Which of the following is the reason behind choosing a logarithmic scale? Select the best possible answer.

Options:
A.

When short periods of trading activity are plotted

B.

When long or short periods of trading activity are plotted

C.

When long periods of trading activity are plotted

D.

When intervals of trading activity are plotted over a limited span

Exam Code: CMT-Level-II
Certification Provider: CMT Association
Exam Name: CMT Level II Exam
Last Update: Jul 9, 2025
Questions: 262

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