The price of a stock fluctuates over a period of 10 days. The movement of the...

Question

Question

Answer 1

Answer #1

The correct answer is option B. penetration point

Penetration point is a price point at which a fierce market force occurs. In our example it is a sell off at $25

Option A is incorrect because a congestion area is an area in which the stock trades in a very narrow range for a significantly longer period

Option C is incorrect because a resistence level is the level at which the stock struggles to cross above the level.

Option D is incorrect because a support level is the level at which the stock struggles to cross below the level.

Can you please upvote? Thank You :-)

Answer 2

Similar Homework Help Questions

A supernova releases 1.3×1045 J of energy (over a period of about 10 days). It is...

A supernova releases 1.3×1045 J of energy (over a period of about 10 days). It is 1520 ly (light-years) from earth. A detector, facing the star, is a disk of radius 7 cm. How much energy reaches the detector? (The detector is in orbit, so it can face the star for the entire 10-day period.)
The price of a stock is $75 per share. The stock is not expected to pay...

The price of a stock is $75 per share. The stock is not expected to pay any cash dividends over the next year. The returns on the stock have a normal probability distribution with expected value of 15% and a standard deviation of 40%. (a) What is the probability that the price of the stock will be $25 or less one year from now? (b) What is the probability that the price of the stock will be between $75 and...
The closing stock price of Ahmadi, Inc. for a sample of 10 trading days is shown...

The closing stock price of Ahmadi, Inc. for a sample of 10 trading days is shown below. Day 1 Stock Price 78 2 67 3 81 4 88 5 74 6 90 7 92 8 86 9 93 10 81 For the above sample, compute the following measures. The mean The median The mode The range

The closing stock price of Ahmadi, Inc. for a sample of 10 trading days is shown...

The closing stock price of Ahmadi, Inc. for a sample of 10 trading days is shown below. Day Stock Price 1 83 2 77 3 81 4 88 5 75 6 90 7 91 8 86 9 93 10 86 For the above sample, compute the following measures. a. The mean b. The median c. The mode d. The range
Suppose in Figure 5.3 that the stock prices of target firms in acquisitions responded to acquisition...

Suppose in Figure 5.3 that the stock prices of target firms in acquisitions responded to acquisition announcements over a three-day period rather than almost instantly. a. Would you describe such an acquisition market as efficient? Why or why not? b. Can you think of any trading strategy to take advantage of the delayed price response? c. If you and many others pursued this trading strategy, what would happen to the price response to acquisition announcements? d. Some argue that market...
Eagletron's current stock price is $ $10. Suppose that over the current year, the stock price...

Eagletron's current stock price is $ $10. Suppose that over the current year, the stock price will either increase by 96% or decrease by 51%. Also, the risk-free rate is 25% (EAR). a. What is the value today of a one-year at-the-money European put option on Eagletron stock? b. What is the value today of a one-year European put option on Eagletron stock with a strike price of $19.60? c. Suppose the put options in parts (a) and (b) could...

Eagletron's current stock price is $ 10. Suppose that over the current year, the stock price...

Eagletron's current stock price is $ 10. Suppose that over the current year, the stock price will either increase by 98% or decrease by 60%. Also, the risk-free rate is 25% (EAR). a. What is the value today of a one-year at-the-money European put option on Eagletron stock? b. What is the value today of a one-year European put option on Eagletron stock with a strike price of $19.80? c. Suppose the put options in parts (a) and (b) could...
3. (Chapter 10) You have observed the following returns on Sonora Data Corp.’s stock over the...

3. (Chapter 10) You have observed the following returns on Sonora Data Corp.’s stock over the past 5 years: 25%, 12%, 17%, -11%, and 7%. a. What was the arithmetic average return on SDC's stock over this five-year period? b. What was the variance of SDC's returns over this period? The standard deviation? Now suppose the average inflation rate over this period was 3% and the average T-bill rate over the period was 4%. c. What was the average real...
Assume the following stock price history for the previous 10 trading days: 53.45 53.55 55.09 52.58...

Assume the following stock price history for the previous 10 trading days: 53.45 53.55 55.09 52.58 52.17 51.24 50.49 48.96 49.03 48.87 Calculate the daily holding period returns (there will be 9 of them). Then calculate the mean and standard deviation of the returns.

I have to make stock changes for the 90 days and professor showed example for 50...

I have to make stock changes for the 90 days and professor showed example for 50 days. I do not know how to do it. The price of a share of a particular stock listed on the New York Stock Exchange is currently $39. The following probability distribution shows how the price per share is expected to change over a three-month period: Stock Price Change ($) - Probability 0.05 0.10 0.25 0.20 0.20 0.10 0.10 + + +1 +2 +3...