Question

Two basic assumptions of technical analysis are that security prices adjust:

A) gradually to new information, and liquidity is provided by security dealers.
B) rapidly to new information, and market prices are determined by the interaction of supply and demand.
C) rapidly to new information, and liquidity is provided by security dealers.
D) gradually to new information, and market prices are determined by the interaction of supply and demand.
E) rapidly to information and to the actions of insiders.

Answer 1

D. Gradually to new information, and market prices are determined by the interaction of supply and demand.

Step-by-step explanation:

Technical analysis is an analysis performed to find the predictive patterns that always shape the stock price which might be used so as to generate returns, some use the analysis for exploitation sake so as to generate abnormal returns as well.

In simpler term, technical analysis is when an analysis is drawn and its main content is stock price fluctuation, both the rise and low are an analysed. Those who use this analysis, use them for hope generating high or normal returns on stock price in its market.