What Is a Chartered Market Technician?

A Chartered Market Technician (CMT) is a professional technical analyst that holds the CMT designation organized by the CMT Association (formerly the MTA), a global credentialing body with nearly 50 years of service to the financial industry. The CMT marks the highest level of training within the discipline and is the preeminent designation for practitioners worldwide. Technical analysis provides the tools to successfully navigate the gap between intrinsic value and market price across all asset classes through a disciplined, systematic approach to market behavior and the law of supply and demand. Earning the CMT demonstrates mastery of a core body of knowledge of investment risk in portfolio management; including quantitative approaches to market research and rules-based trading system design and testing.

Understanding CMT

To be granted a Chartered Market Technician (CMT) designation, a candidate must pass three examination levels, complete the membership application process, and agree to the CMT Association’s code of ethics. To register for the CMT Program, individuals must first join the CMT Association as an affiliate member and then enroll in the CMT program. After enrolling in the program, candidates can then pay and register for their exam. All three levels of the CMT program exams are given on a computer at testing facilities such as Prometric, for example.

Among industry practitioners, the CMT designation is widely considered the gold standard in technical analysis globally.

The CMT Exam

The purpose of the CMT Program is to promote the development of a candidate's professional knowledge with respects to the field of technical analysis. The CMT Program is self-study. The curriculum is available through Wiley – Efficient Learning.

The CMT Level I exam measures basic, entry-level competence and understanding of technical analysis. The Level I candidate needs to have a working knowledge of the basic tools of a technical analyst. Once the first level is successfully completed there is no time limit to pass the subsequent levels. The CMT website states that the Level 1 exam measures basic, entry-level competence and understanding; the candidate needs to have a working knowledge of the basic tools of the technical analyst:

CMT Level I Topics Areas
Content Areas Percent ~Number of Questions
Theory and History 10% 12
Markets 3% 3
Market Indicators 13% 16
Construction 15% 18
Trend Analysis 15% 18
Chart and Pattern Analysis 18% 22
Confirmation 10% 12
Cycles 4% 5
Selection and Decision 5% 6
System Testing Money Management 5% 4
Ethics 3% 4
Total 100% 120

The CMT Level II exam requires the candidate to demonstrate a greater depth of analysis and use of technical tools. The Level II candidate is expected to demonstrate proficiency in applying more advanced analytical techniques and technical analysis theory. The MTA website states that the Level 2 exam requires the candidate to demonstrate a greater depth of analysis and use of technical tools. Candidates are expected to demonstrate proficiency in more advanced analytical techniques and technical analysis theory.

CMT Level II Topic Areas
Content Area Percent ~Number of Questions
Theory and History 3% 4
Market Indicators 5% 7
Construction 1% 1
Trend Analysis 20% 30
Chart and Pattern Analysis 23% 35
Confirmation 15% 23
Cycles 3% 4
Selection and Decision 17% 26
System Testing Money Management 10% 15
Ethics 3% 5
Total 100% 150

The CMT Level III exam tests the candidate on the development of logical and consistent research opinions, portfolio strategies and trading decisions based on a wide range of charts and technical data. The Level III candidate is asked to analyze case studies, make recommendations and justify those recommendations based on the data provided. All candidates must pass the ethics portion of this exam. Upon successfully completing Level III, candidates can start the membership process to obtain the Chartered Market Technician® Designation. The MTA website states that the Level 3 exam requires the candidate to analyze case studies, and make and justify recommendations based on data provided. The primary focus of the exam is the practical and ethical application and integration of technical analysis.

The CMT program is self-study, so be sure to follow the required readings for each level. You cannot choose to write both the research paper and the exam, you must choose one. If you choose to write a research paper, you must demonstrate your ability to integrate what you have learned in levels 1 and 2 with actual data analysis. If the peer review panel of the MTA Accreditation Committee reviewing your paper passes you, your paper could be published in the MTA's Journal of Technical Analysis.

Additional CMT Association Membership Requirements

In addition to the above listed requirements of passing three examination levels, completing the membership application process, and agreeing to the CMT Association’s code of ethics, candidates must secure at least three CMT Charterholder references who can speak to the candidate's knowledge, skill and ability in the field of technical analysis. During the reference phase, also known as the "sponsorship" phase, CMT candidates will offer their original research to different CMT Charterholders within the Technical Analysis community for sponsorship into the CMT Association. CMT Charterholders will review the CMT candidate's original technical analysis research and makes a determination through a sponsorship application to support an individual's candidacy.

In addition, CMT candidates must complete at least three years of professional work experience practicing technical analysis in their position.