Question

Which of the following are accurate as they relate to technical analysis?

I. A golden cross describes when a short-term average crosses up and through a longer-term average.
II. A continuation pattern indicates a price trend is moving strongly toward/with its longer term trend.
III. A dead cross describes when a long-term average crosses down and through a shorter-term average.
IV. A corrective pattern indicates a price trend is moving against the larger or more important trend.

• I and II only
• II and III only
• III and IV only
• IV and I only

Answer 1

Solution A golden cross is a bullish breakout pattern where short term moving average break and move above long term moving average. A Continuation pattern indicate continuation of trend in same direction as did earlier. There is slight tendency of continuation pattern A dead cross is a bearish breakout pattern where short term moving average break and move below long term moving average. A corrective pattern tend to move against larger trend Hence, on the basis of above discussion 4th option IV and I only is correct.