CTA Cheat Sheet 2026

The 30 highest-yield CTA facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. What does 'negative volume divergence' signal when price reaches new highs? → Weakening buying pressure, suggesting the uptrend may be losing momentum
2. Which phase follows a market peak? → Contraction
3. A 'Piercing Line' pattern is the bullish equivalent of which bearish pattern? → Dark Cloud Cover
4. A 'Doji' candlestick is significant because it indicates: → A period where opening and closing prices are nearly equal, reflecting market indecision
5. What does a stop-loss order do? → Sells shares to limit losses
6. The concept of 'price memory' in technical analysis refers to: → The tendency of price to react to previously established levels
7. What is the primary purpose of identifying support and resistance levels in technical analysis? → To identify price zones where buying or selling pressure is significant
8. In time series analysis of price data, what does autocorrelation measure? → The correlation between a time series and a lagged version of itself
9. Which type of gap occurs within an established trend and signals trend continuation? → Runaway (continuation) gap
10. In the context of trend analysis, what is an 'internal trendline'? → A trendline drawn through the interior of price action, ignoring extreme highs/lows
11. What does a moving average help identify? → Overall market trend direction
12. In cycle analysis, what is 'left translation' and what does it imply? → A cycle that peaks in the first half of its nominal duration, typically bearish
13. What does a symmetrical triangle usually indicate? → Consolidation before breakout
14. What is a trailing stop order? → Dynamic stop that moves with price
15. How is volume important in technical analysis? → Confirms strength or weakness of a trend
16. Which breadth indicator measures the percentage of stocks trading above their 200-day moving average? → The percentage of stocks above MA200
17. Which type of chart uses boxes and Xs to represent price movement? → Point and figure chart
18. Why do technical analysts use a logarithmic (semi-log) scale on long-term price charts? → To represent equal percentage price changes as equal vertical distances on the chart
19. What defines a bear market? → 20% decline or more
20. How does an Exponential Moving Average (EMA) differ most significantly from a Simple Moving Average (SMA)? → The EMA gives progressively greater weight to more recent price data
21. What defines support in chart analysis? → Area where price tends to stop falling
22. What does R-squared (R²) measure when linear regression is applied to price data? → The proportion of price variance explained by the regression model
23. What is the Moving Average Convergence Divergence (MACD) used for? → Analyze trend momentum and direction
24. In a normal distribution, approximately what percentage of data falls within two standard deviations of the mean? → 95%
25. In technical analysis, what does 'confluence' refer to? → Multiple independent technical signals pointing to the same price level or outcome
26. Which technical indicator is commonly used to compare the performance of two securities in relative strength analysis? → A ratio or relative strength line (Price A / Price B)
27. In Dow Theory, what does a 'higher high followed by a higher low' indicate? → A confirmed uptrend
28. What is an economic indicator that signals an economic downturn? → Inverted yield curve
29. What does a lagging indicator measure? → Confirms existing trends
30. In volume analysis, what does 'accumulation' typically look like on a chart? → Higher volume on up days and lower volume on down days over a period