Momentum trading: how do you actually measure momentum?

FTC Community TeamStaff99 views

Momentum means the move is continuing — but traders measure it a dozen ways: rate of change, MACD, RSI slope, consecutive closes, ADX. The measurement defines the strategy.

Momentum trading: how do you actually measure momentum? — moving average crossover diagram
A fast moving average crossing a slower one

What's your momentum definition?

  • the indicator or price measure you use
  • how you enter and exit momentum trades
  • the regime where momentum fails for you
Momentum trading: how do you actually measure momentum? — central bank rate path diagram
A central bank's policy rate path across recent meetings

The MACD guide and moving averages cover two classic measurements.

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