Technical analysis is based on all of the following assumptions except:
A)that market value is determined by the interaction of demand and supply.
B)that stocks with strong earnings gains will outperform the market.
C)the assumption that, though there are minor fluctuations in the market, stock prices tend to move in trends that persist for long periods of time.
D)that shifts in demand and supply can be detected sooner or later.
E)that reversals of trends are caused by shifts in demand and supply.

Question

Quizplus · Accepted Answer

Technical analysis is based on a number of basic assumptions:1. Market value is determined solely by the interaction of demand and supply.2. It is assumed that, though there are minor fluctuations in the market, stock prices tend to move in trends that persist for long periods.3. Reversals of trends are caused by shifts in demand and supply.4. Shifts in demand and supply can be detected sooner or later in charts.5. Many chart patterns tend to repeat themselves.

Technical Analysis Is Based on All of the Following Assumptions