Study Guide for Come Into My Trading Room - Forex Factory

FINANCIAL TRADING FOR BABES IN THE WOODS 89
Answer 8
A. 1
B. 3
C. 5
D. 2, 4
Give yourself a point for each correct answer.
Fundamental analysts study supply and demand, which drive prices
in the long run. Market technicians try to read the behavior of the market
crowd. Both can be used for making trading decisions, although
fundamentals are more important for long-term investors and technicals
for short-term traders. Neither predicts future prices; they tell you what
is happening in the markets now and leave you to decide how to play
the odds for the future. Neither can be automated any more than dentistry
or driving can be automated.
Rating Yourself
Below 31 Poor. Do not despair, you are just starting to test yourself. Go
back, reread the recommended literature, and then retake this test.
31–36 Fairly good. You have grasped the basic ideas. Look up the
answers to the questions you have missed. Review them and retake
this test in a few days.
37–41 Excellent. Armed with this understanding, you are ready to
move up and tackle the 3 M’s of successful trading.
Required Reading
Elder, Alexander. Come into My Trading Room (New York: John Wiley
& Sons, 2002). See Part One “Financial Trading for Babes in the
Woods.”
Additional Reading
Elder, Alexander. Trading for a Living (New York: John Wiley & Sons,
1993). See “The Odds Against You” (pages 6–11).