{"id":1882,"date":"2019-11-12T10:17:33","date_gmt":"2019-11-12T07:17:33","guid":{"rendered":"https:\/\/roboforex.com/blog\/?p=1882"},"modified":"2026-05-26T10:53:13","modified_gmt":"2026-05-26T07:53:13","slug":"momentum-efficient-oscillator-or-trend-indicator","status":"publish","type":"post","link":"https:\/\/roboforex.com/blog\/blog\/2019\/11\/12\/momentum-efficient-oscillator-or-trend-indicator\/","title":{"rendered":"Momentum: Efficient Oscillator or Trend Indicator?"},"content":{"rendered":"\n

Momentum <\/strong>is one of the simplest and most popular indicators<\/a> among traders. As its creator, certain sources name a French mathematician Paul Émile Appell<\/strong>. This indicator helps define the trend direction and the speed of the price change.<\/p>\n\n\n\n

<\/span>Description of Momentum<\/span><\/h2>\n\n\n\n

Momentum is an oscillator type indicator that compares the closing price of the current timeframe<\/a> with that of the set interval. We may say that Momentum shows the speed (rate) and the direction of the price change.<\/p>\n\n\n\n

The popularity of Momentum is mostly explained by its simplicity, its universal character, and the ability to give leading signals<\/a> from time to time. Momentum not only shows the direction of the price movement but also, evaluating the speed of the quotation change, may show the points of reversion on the chart.<\/p>\n\n\n\n

Momentum helps define whether the trend is speeding up or slowing down. When the indicator reaches a new maximum, it means that the optimism of the market crowd is growing, and the prices are likely to go on growing. When Momentum falls to a new minimum, it indicates an increase in the market pessimism and a high probability of further falling of the prices. The indicator is calculated in a separate window under the price chart.<\/p>\n\n\n\n

\"Description<\/a><\/figure>\n\n\n\n

<\/span>The formula, characteristics, and settings<\/a><\/span><\/h2>\n\n\n\n

Momentum consists of one main line that compares the current price position to that of the previous period. <\/p>\n\n\n\n

Initially, the formula for Momentum looked as follows:<\/p>\n\n\n\n

Momentum = Close(i) - Close(i-n)<\/strong><\/p>\n\n\n\n

Where:<\/p>\n\n\n\n