Charts & technicals
What is Momentum?
Hinglish mein padhein: Momentum kya hota hai?
Momentum is the tendency of stocks that have risen strongly to keep rising for a while (and fallers to keep falling).
Momentum investors buy recent winners, often measured by 6- to 12-month returns. It works on average but suffers sharp reversals.
Indicators such as RSI, MACD and rate of change measure short-term momentum.
Related terms
- RSI (Relative Strength Index)RSI is a momentum oscillator from 0 to 100 that compares recent gains with recent losses, usually over 14 periods.
- MACDMACD is the difference between the 12-day and 26-day EMAs, with a 9-day EMA 'signal line'. Crossovers and the histogram show momentum shifts.
- 52-week high and lowThe 52-week high and low are the highest and lowest prices a stock has traded at over the past year.