Study Guide for Come Into My Trading Room - Forex Factory

108 ANSWERS AND RATING SCALES
Give yourself a point for choosing the correct answer.
While the slope of an EMA identifies the trend, Bull Power and Bear
Power show how far the high and the low of each bar deviate from the
EMA. The time to buy in an uptrend is when a bar straddles the EMA,
but Bear Power begins to slip. The time to sell short in a downtrend is
when a bar straddles the EMA, but Bull Power begins to weaken.
Answer 37
1. A, C, D
2. F
3. B
4. B-E
5. E
Give yourself a point for each correct answer (half a point if you missed
one of several occurrences). Add two points if you got the bonus question
right, or a point for getting it partly right.
When the trend, identified by the slope of the EMA, is up and Bear
Power becomes negative but then ticks upward, it gives a buy signal.
This occurred three times during the uptrend of April–May. The opposite,
a shorting signal, occurs when the EMA signals a downtrend, and
Bull Power rises to or above zero, but then ticks downward. Whenever
Bull Power traces a new record peak for the past several months, it identifies
great power of bulls and calls for higher prices ahead. Shortly
before entering area E, Bull Power became negative for the first time
since the beginning of the rally; when it rose to a new, lower peak and
then ticked down, it completed a bearish divergence. That strong sell
signal was confirmed by a kangaroo tail; important technical signals
often confirm one another.
At the right edge of the chart—bearish. The trend, identified by the
EMA, is down, and Bear Power is becoming deeper, while bulls are
underwater. Wait for a rally to the EMA to add to shorts.