ch_15_sol - CHAPTER 15: TECHNICAL ANALYSIS 1. Resistance...

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ANALYSIS 1. Resistance level Support level The resistance level is established by the history of the market reaching but failing to rise above a given price range. The support level is established by the history of the market reaching but failing to fall below a given price range. 2. Trin = = = .799 This trin ratio, which is below 1.0, would be taken as a bullish signal. 3. Breadth: Day Advances Declines Net Adv Cumulative Breadth Monday 1,403 1,615 - 242 - 242 Tuesday 1,781 1,264 517 +275 Breadth is postive and increasing. This is a bullish signal (although no one would actually use a two-day measure as in this example). 4. This exercise is left to the student. 5. The confidence index rises from 8/9 = .889 to 9/10 = .90. This would indicate slightly higher confidence. But the real reason for the increase in the index is the expectation of higher inflation, not higher confidence about the economy. 6.
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This note was uploaded on 10/28/2009 for the course MBA MBA608 taught by Professor Martin during the Spring '09 term at Beirut Arab University.

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ch_15_sol - CHAPTER 15: TECHNICAL ANALYSIS 1. Resistance...

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