Exercise #4


Using the Sector Distribution Curve pictured here, answer the following questions.

2.) Which statement most accurately describes the Drug sector.

Your answer was C. The Sector Bullish Percent chart is in O's and the group is Average. When the sector reverses up to X's, selective purchases can be made.

Correct! The sector bullish percent chart is in O's since the sector name is in lowercase letters. The group is Average since its shading is yellow. When Average sectors have their bullish percent charts in X's, selectivity is the key in evaluating members of the sector for purchase. Look for those stocks with the strongest market and peer relative strength readings.

Go to next question.