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CMT-Level-II CMT Association CMT Level II Exam Free Practice Exam Questions (2025 Updated)

Prepare effectively for your CMT Association CMT-Level-II CMT Level II Exam certification with our extensive collection of free, high-quality practice questions. Each question is designed to mirror the actual exam format and objectives, complete with comprehensive answers and detailed explanations. Our materials are regularly updated for 2025, ensuring you have the most current resources to build confidence and succeed on your first attempt.

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Total 262 questions

When using the RSI as an overbought/oversold indicator, a sell signal is generated when:

A.

RSI declines below its lower reference line and then rallies above it.

B.

RSI rises above its upper reference line and then crosses below it.

C.

RSI crosses beneath the midpoint (50 level).

D.

RSI crosses above the midpoint (50 level).

A trend based trading system where the trend is the slope of a straight line found using a least squares regression:

A.

Point and figure

B.

Simple moving average

C.

Linear regression slope

D.

N-day breakout

Which of the following factors would be a CORRECT interpretation of the morning star pattern?

A.

The pattern contains two candles

B.

The real bodies of the first and second candles generally overlap

C.

It is considered a bullish reversal pattern

D.

It is considered a bearish reversal pattern

Which of the following statement is not true about the Diamond Top with regards to pattern analysis?

A.

It is a profitable pattern

B.

It consists of a combination of a broadening pattern and a symmetrical triangle

C.

It occurs at the top of a very sharp upward rise in prices

D.

It is not rare at price bottoms

Which of the following is one of the key rules for traders?

A.

Take profits but be patient with losing positions and give them time to rebound

B.

Buy low, sell high

C.

Be a contrarian and trade against the trend

D.

Always meet margin calls promptly

Which of the following is true of the separating lines pattern?

A.

The top of the upper shadow of one candle is at the same price as the bottom of the lower shadow of the other candle

B.

The opening price of the second candle equals the opening price of the first candle

C.

The two candles have the same color

D.

It is a reversal pattern

Abandoned baby patterns:

A.

appear upon completion of star patterns

B.

appear nowhere in star patterns, only in box ranges

C.

ideally has a doji as second real bottom

D.

can only be formed over long periods of time

When small cap stocks have abnormal strength, this can be attributed to the:

A.

The January Barometer

B.

The January Effect

C.

Kondratieff K-Wave

D.

Hindenburg Omen

__________ is a perception bias that arises when you are attempting to take a guess at something about which you have limited information.

A.

Saliency

B.

Framing

C.

Sunk-cost

D.

Anchoring

Which of the following is a general rule for trading futures?

A.

Due to the fact that markets only trend 30% of the time, 100% of capital should be invested at all times

B.

The majority of capital should be committed to the strongest market since it is rare that more than two or more markets will experience a major move simultaneously

C.

Total amount risked on any single trade should not exceed 5% of equity

D.

At least 50% of total equity should be dedicated to the market group with the strongest trend

What two characteristics MUST a cycle possess in order for it to be traded rationally:

A.

There must be a reason for its existence and it must have regular intervals between peaks

B.

There must be confidence that the cycle will continue and it must be synchronized with another cycle

C.

There must be a reason for its existence and confidence that it will continue

D.

There must be a way to forecast it and it must be synchronized with another cycle

How can one identify the existence of a cycle?

A.

Switch time frames

B.

Remove price trend

C.

Remove volume trend

D.

Use n period extremes

Which of the following is NOT a basic principle of cycles?

A.

Summation

B.

Synchronicity

C.

Harmonicity

D.

Alternation

When analyzing price action and volume, low activity (or a drop in volume) is normally associated with:

A.

a weak price trend.

B.

a strengthening price trend.

C.

greater fluctuations in price.

D.

lack of conviction on the part of traders.

Which of the following scale is used to plot data for investment and trading?

A.

The arithmetic scale is preferred

B.

A linear scale is preferred

C.

A logarithmic scale is preferred

D.

A logarithmic or a linear scale is preferred

Which of the following is true of moving average crossovers?

A.

It is considered bearish when a short term moving average crosses above a longer term moving average

B.

In a triple crossover trading system buying is signaled when the shortest term moving average crosses over one of the other moving averages

C.

The first crossover in a triple crossover system during an upside reversal is when the shortestterm moving average crosses above one of the other two averages

D.

Once a moving average system is optimized, it can be used for trading all markets

What is the specific name given to the normal distribution for having special characteristics?

A.

Center limit theorem

B.

Histogram

C.

Central limit theorem

D.

All of the above statements

Which of the following best helps quantify the risk of a trading system?

A.

Maximum Cumulative Drawdown

B.

Maximum Favorable Excursions

C.

Longest Flat Time

D.

Length of Average Winning Trade

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Total 262 questions
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