Technical Analysis??

[delhirocks]

I am having a tough time with all the ratios in the technical analysis section (SS14). I guess my mind is just saturated with all the formulae that I am supposed to remember cold after doing FSA, & SS13, or maybe because its summer and here in Seattle we have the sun out and my mind is else where...

What kind off questions can I expect to see in the exam on this topic, if its something like

Diffusion index is
A
B
C
D
then I can probably answer that, but am I also supposed to remember things like when x% or more of stock index futures traders are bullish, contarians become bearish
x = a: 50%, b= 75%...etc

Secondly...Those who passed...how the heck did you remember all the formulae/ratio/concepts. I am doing everything that has been on the to-do list, read notes, take 80-100 questions, make sure I score more that 85-90% before moving on to the next session. But after a couple of months, Quant seems like greek to me...it has all been erased from my mind.

sorry for the rant..

 

[PeteyPete]

I wouldn't waste my time toiling over the minutia of Tech Analysis....it's not heavily tested, and doesn't account for many points. Go over FSA/Ethics/Quant and buy the CFAI practice tests.

As for remembering all the formulas.....no real tricks, just repetition. I just wrote out all the formulas on a few pieces of paper and hung them on the sides of my computer monitor. In between looking at DrudgeReport, YahooFinance, and Autoblog, i'd go over formulas.

 

[lakai99]

They'll test the concepts underlying the formulas far more frequently on the exam then they will actual computation utilizing them.

Keep that in mind while studying, if you are using schweser it will give you a false impression of the ratio of qualitative to quantitaive questions on the exam. It'll help with the memorization of formulas but it's vital to actually understand the underlying concepts related to them. I can't stress it enough, good luck on the studying!

 

[hiredguns1]

delhirocks, a few comments on technical analysis and formulas in general:

Regarding technical analysis, I don't recall all the LOS, but be certain to understand the various trading strategies, and more importantly how technicians differ from fundamentalists. Each approach has its own strengths and weaknesses and is affected differently by the three forms of Efficient Market Hypothesis. There's too much detail to go into here, but generally, I don't recall this section placing much emphasis on formulas. If you post any specific technical analysis questions, I'll give them a shot.

Regarding formula memorization, it seems daunting at first, but you start by memorizing them and by D-Day you'll just know them by heart. The difference is memorization vs. understanding, which you'll gain over time. I used to write formulas on scratch-paper repeatedly, at random points in the day as a sort of pop-quiz. More helpful, I have a giant dry-erase board in my apartment where I posted nasty equations and other problematic areas of the curriculum so that they'd be confronting me at all times until I understood them. You can even post them on the walls in your office... strange? maybe, but on exam day I knew every LI equation cold. Worked well for learning LII formulas too, but I have yet to see whether that paid off...

Good luck!

 

[canbonbon]

I have not seen many questions in the practice exams on Technical Analysis. Actually the questions I saw were on the uptick/downtick ratio, relative strength and a couple on confidence index. This in no way means that they will not ask others. I have not seen anything on Diffusion index yet though.

Practically however, Technical Analysis is a failed theory. Most trading softwares do not work on general market movement indicators (maybe shady hedge funds might do that). So I am not sure how much weightage is/would be given to this topic. But we should read/study it anyway to cover our bases, just like any other topic in the course. As others have pointed out, I am trying to focus on FSA, Quant, Eco and Ethics. Hiredguns1 thanks for your tip on formulas, I will try to make those charts. I have found the flashcards to be useful too.

 

[aza]

I was worried about learning all the formulas by the exam date, too. However, as people pointed out above, understanding formulas and underlying concepts is much more important!
Believe me, on the exam date you will be surprised by how much your mind has retained! It might seem that you forget things you've read, but if you really do understand the concepts, you will be able to pick up answers from your head .