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Momentum & Indicators

Momentum

Momentum is the speed and strength of a price move — how forcefully price is travelling, regardless of direction.

Momentum building, then fading
↑↑↑strongfading
Illustrative example — a schematic of how momentum looks on a chart.

Momentum measures the rate of change of price rather than its level. Strong momentum means a move is powerful and likely to continue; fading momentum warns that a trend is running out of energy even if price is still rising or falling.

Momentum indicators like RSI and MACD exist to quantify this. They are most useful as a confirmation layer — momentum agreeing with trend is a higher-probability setup than either alone.

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