Its signal tells you the direction of acceleration.
The short answer
- What is Momentum (Momentum)?
- Momentum: price now minus price n candles ago.
- When does Momentum get it wrong?
- Raw and uncalibrated · hard to compare across symbols. See its current reading on the platform's symbols, at the latest daily close, in the "Current reading" table on this page. See current reading →
Reading now
| Ticker | Value | Five sessions ago | Status |
|---|---|---|---|
| SPY | 13.81 | 5.71 | Above 0 |
| QQQ | 5.64 | 12.20 | Above 0 |
| IWM | −2.31 | −5.87 | Below 0 |
| DIA | 3.33 | −3.44 | Above 0 |
A description of where the number sits against its thresholds. It is not an entry or exit signal.
Indicator limit
Raw and uncalibrated · hard to compare across symbols.
Read it with
Average True Range: its value is in price units, so it is divided by ATR to compare across symbols.
Answers: is momentum changing?
What it actually does
The Momentum indicator is the simplest in the family: today's price minus the price N sessions ago. A positive number means price is higher than it was, a negative one the reverse, and the size of the number is the speed of change, not just its direction. Simplicity is its strength: no smoothing hides anything and no parameter distorts it.
How it is read in practice
Three readings: the sign (above or below zero) · the slope (is momentum accelerating or fading) · and the zero crossing, which means today's price equals the price of the earlier window. The slope is the most valuable: positive but shrinking momentum means a rise losing speed before it reverses.
How it relates to the rest of the family
The parent of many indicators. Rate of change is its percentage form, and MACD is its double smoothing. Once you see that, every momentum indicator answers one question in different words: is the move speeding up or fading?
Hypothetical example
An index rises four weeks in a row while its 10-day momentum falls from 8 to 3: the rise continues but at a third of its former speed. No sell signal yet, but it is an environment for trimming size and tightening stops, not adding to a position.
Where it errs and why
It has no bounds, so no general thresholds work for every asset, and its absolute value can't be compared between two symbols at different prices. Like its siblings, it crosses zero late in sideways markets and produces conflicting signals.
Read it with
Read it with rate of change, which solves the comparison problem by turning it into a percentage. Add volume to tell supported acceleration from thin moves, and trend strength to see whether the market suits momentum trading at all.
Where to see it on the platform
The technical chart shows it in the momentum family, and the momentum scanner ranks symbols by how fast they are moving, not just by size.
