Exam 9: Behavioral Finance and Technical Analysis

It is difficult to test the Kondratieff wave theory because ________.

If you are not a contrarian, you consider a high put/call ratio to be a ________.

An investor has her money segregated into checking, savings, and investments. The allocation among the categories is subjective, yet the investor spends freely from the checking account and not the others. This behavior can be explained as ________.

Problems with behavioral finance include: I. The behavioralists tell us nothing about how to exploit any irrationality. II. The implications of behavioral patterns are inconsistent from case to case, sometimes suggesting overreaction, sometimes underreaction. III. As with technical trading rules, behavioralists can always find some pattern in past data that supports a behavioralist trait.

A TRIN ratio of greater than 1 is considered a ________.

A support level is ________.

When a stock price breaks through the moving average from below, this is considered to be ________.

The put/call ratio is a ________ indicator.

When technical analysts say a stock has good "relative strength," they mean that in the recent past ________.

A ________ is a value above which it is difficult for the market to rise.

According to technical analysts, a shift in market fundamentals will ________.

Moving averages are ________ indicators.

In the context of a point and figure chart, a horizontal band of Xs and Os is a ________.

If you believed in the reversal effect, you should ________.

The ratio of the average yield on 10 top-rated corporate bonds to the average yield on 10 intermediate-grade bonds is called the ________.

Identify the support level stock price.

When the housing bubble burst in 2007, it set off the worst financial crisis ________.

Investors gravitate toward the latest hot stock even though it has never paid a dividend. Even though net income is projected to fall over the current and next several years, the price of the stock continues to rise. What behavioral concept may explain this price pattern?

The most common measure of ________ is the spread between the number of stocks that advance in price and the number of stocks that decline in price.

When the stock price falls below a moving average, a possible conclusion is that ________.