An alternative approach to forecasting the behaviour of share prices is technical analysis.Which of the following statements in relation to the approach taken by technical analysts is incorrect?
A) As a price pattern emerges, it is assumed that the historical pattern will re-emerge in full.
B) The stock markets are, at times, dominated by mass psychology.
C) Historical price patterns are of little use in forecasting future price movements.
D) Analysts typically adopt either a 'technical' or a 'fundamental' approach.

Question

Quizplus · Accepted Answer

This statement is incorrect as historical price patterns are central to the approach taken by technical analysts in forecasting future price movements.

An Alternative Approach to Forecasting the Behaviour of Share Prices