CMT Market Cycles Flashcards
6 cards from real CMT practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CMT Market Cycles flashcards as text
The Hurst Cycle model primarily focuses on identifying:
Answer: Nested cycles of varying periodicity in price data
J.M. Hurst's cycle model identifies nested cycles of different lengths in price data, using the principle that cycles are harmonically related and synchronize at troughs.
In market cycle analysis, the 'four-year cycle' in US equities is most associated with:
Answer: The presidential/business cycle
The four-year US equity cycle is closely associated with the presidential and business cycle, driven by policy stimulus and economic expansion and contraction rhythms.
According to Dow Theory, what is required for a primary trend signal in equities to be considered confirmed?
Answer: Both the DJIA and the Dow Jones Transportation Average must confirm each other
Dow Theory requires both the DJIA and the DJTA to confirm a primary trend signal, as divergence between the two averages casts doubt on the trend's validity.
In Elliott Wave Theory, which wave within an impulse sequence is typically the longest and strongest?
Answer: Wave 3
Wave 3 is almost always the longest and most powerful impulse wave, characterized by broad market participation, high momentum, and strong fundamental confirmation.
The seasonal tendency for US equity markets to perform well from November through April is known as:
Answer: The Halloween Indicator
The Halloween Indicator (or 'Sell in May and Go Away') refers to the historical tendency for equities to perform better from November through April than from May through October.
In Dow Theory, 'lines' refer to:
Answer: Horizontal price ranges reflecting accumulation or distribution
In Dow Theory, a 'line' is a narrow horizontal price range (typically within 5%) over several weeks, representing accumulation or distribution before a breakout.