Exam 12: Behavioral Finance and Technical Analysis

Technical analysts use financial statements as the basis for making investment decisions.

"Resistance" for a stock suggests that supply will blunt further price increases.

Which of the following is not used in technicalanalysis

If a stock meets a resistance level and penetrates that level, the implication is avoid the stock.

Behavior finance explains dramatic price changes in securities markets as a tendency for investors to "herd."

The moving average convergence divergence indicatoruses

The Dogs of the Dow strategy

A "head and shoulder" pattern suggests that a stock's price will fall.

Behavioral finance asserts that emotional investing produces higher returns.

Insider purchases of stock are considered bullish.F 19 Evidence supporting technical analysis is the lack of serial correlation between stock prices.

Behavior financial suggests that investors may fail to sell losing positions since these investors feel the pain of regret.

Technical analysis stresses historical information and suggests that patterns of securities prices repeat.

Individuals who do the opposite of what investment analysts are suggesting are "contrarians."

If technical analysis cannot be demonstrated to produce higher returns, that is evidence supporting efficient markets.

The technical approach suggests that future stockprices are forecasted by

Behavioral finance suggests that

A point-and-figure chart such as an X-O chart tracks dividends and earnings.

Few investors believe they are smarter than other investors and hence are not overconfident.

The Dow Theory considers price movements in the Dow Jones industrial and transportation averages.

Long dark candlesticks suggests