Consider the following five statements:
i.Technical analysts rely on very sophisticated technical models of the macroeconomic environment.
ii.Since all chartists are confronted with identical share price data,they should identify very similar patterns and generate identical buy and sell signals from the data.
iii.A chartist will draw resistance levels at higher share price levels where an increase in supply halts price increases.
iv.Chartists will draw support lines at lower price levels where an increase in demand halts a price fall.
v.The random walk hypothesis,as applied to share price movements,implies that the examination of past price movements yields no useful information on the course of future price movements.
How many of these statements are true and how many are false?
A) 4 statements are true and 1 is false.
B) 3 statements are true and 2 are false.
C) 2 statements are true and 3 are false.
D) 1 statement is true and 4 are false.

Question

Quizplus · Accepted Answer

Statements iii, iv, and v are true. Statement i is false because technical analysts focus on price patterns, not macroeconomic models. Statement ii is false because chartists may interpret data differently and not generate identical signals.

Consider the Following Five Statements