A technical analyst would consider the following a strong buy signal:
A) a graph of declining prices ends in a trough followed by an upward trend that breaks through the declining trend channel.
B) a graph of increasing prices ends in a peak followed by a downward trend that breaks through the rising trend channel.
C) a graph begins to trade in a flat trend after it breaks out of its rising trend channel.
D) a graph begins to trade in a declining trend after it breaks out of its flat trend channel.
E) a graph begins to trade in a flat trend with high volume.

Question

Quizplus · Accepted Answer

A trough followed by an upward trend that breaks through the declining trend channel is a classic signal for a technical analyst to consider a strong buy. It can be an indication that the downtrend is over and a new uptrend is starting.

A Technical Analyst Would Consider the Following a Strong Buy