I am trying to measure the strength of a simple moving average crossover and I have seen the following in PRT manual:
REM Compute the differential speed between the short and the long moving average
speed = MOMENTUM(malong–mashort) * 100 / CLOSE
but when I look in the PRT manual index it shows that the indicator MOMENTUM requires only 1 parameter n which is the number of periods previous when comparing the current closing price to a previous period??
How can MOMENTUM have two parameters, is it any good at measuring the strength of a cross over and what should the range of values be please for a weak to strong cross over and cross under?
Thanks in advance
It seems that 1 parameter is enough for the classic MOMENTUM indicator: https://en.wikipedia.org/wiki/Momentum_(technical_analysis).
Roberto thank you.
But PRT manual for Screener and auto trading shows MOMENTUM having 2 parameters – slow and fast moving averages and I am keen to use it to measure the strength of a crossover – but I am confused! I have also seen this in the library on this website https://www.prorealcode.com/prorealtime-market-screeners/4-and-9-day-crossover/
speed = MOMENTUM(malong–mashort) * 100 / CLOSE
What calculation takes place with 2 parameters and how does this measure the strength of a cross over?
They are not 2 parameters.
It’s an expression which is evaluated first, then the result is served to the indicator.
Roberto – you are correct of course thank you – I need more coffee as my concentration is slipping!
But if MOMENTUM normally accepts the number of periods as a parameter why would you use the difference of 2 moving averages as this is simply a a price difference number and not a time period???
I would love to understand this more before I use it and what the corresponding output range of values may be and what they mean?
why would you use the difference of 2 moving averages as this is simply a a price difference number and not a time period???
To calculate the momentum of the difference of these 2 MA.
Anyway, you can compute the momentum of everything, look at this page: https://www.prorealcode.com/documentation/momentum/
Maybe I missing something obvious here but if
momentum = Moving Average Long – Moving Average Short : as an absolute number or
momentum = (Moving Average Long – Moving Average Short) *100/Close :as a percentage
then the PRT manual is wrong when it looks at the strength of a cross over and says
“speed = MOMENTUM(malong–mashort) * 100 / CLOSE”
surely it should say
“speed=malong -mashort” OR
“speed=(malong–mashort) * 100 / CLOSE”
Any feedback is appreciated
You are right, I think that it is not mentioned anywhere in the documentation. For the Momentum indicator, if the period is not defined, it is automatically adjust to 12 periods, so:
speed = MOMENTUM(malong–mashort) * 100 / CLOSE
is the same as
speed = MOMENTUM[12](malong–mashort) * 100 / CLOSE
EDIT: after some research, it is indeed the case for any indicator, if you don’t specify a period, the default one is used (e.g. 14 periods for RSI).
Nicolas thank you very much for your assistance.
It is still unclear to me whether the parameter N used with Momentum[N] is a time period or a price or something else as some places seem to say it is a time period and others a price.
e.g. N = 5 periods on a 1 minute chart so Momentum[5] would compare the current price with the price 5 minutes ago
i.e.Price now – Price 5 minutes
OR
N= slowmovingaverage-fastmovingaverage – so Momentum[slowmovingaverage-fastmovingaverage] would calculate what exactly? – what is the formula?
I am still confused sorry.
Brackets are different from parenthesis !
[Period of calculation] (data for the calculation)
This will return the 14-period Momentum of the difference, 5 bars ago, between two MA’s (so difference from bars 14 through 18):
Momentum[14](lowmovingaverage[5]-fastmovingaverage[5])
Aha thank you.
So if I have understood this correctly
speed = MOMENTUM[12](malong–mashort)
the calculation is speed=(malongcurrent – mashortcurrent) -(malong12periodsago-mashort12periodsago)
Correct?
This will return the 14-period Momentum of the difference, 5 bars ago, between two MA’s (so difference from bars 14 through 18):
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Momentum[14](lowmovingaverage[5]–fastmovingaverage[5])
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Sorry I do not think this is correct as the manual says the parameter I for Momentum(I) is an indicator slowma[5]-fastmav[5] is a number not an indicator.
Maybe Momentun[14](slomav[5])- Momenum[14](fastma[5]) is the correct way to measure the strength/speed of the crossover?
Sorry to ask again but can anybody please clarify how the Momentum indicator works with moving averages?
The PRT provides little help and contradicts itself.
The PRT manual says that the parameter it accepts is an indicator but then it shows an example with moving averages where a number (the difference between 2 moving averages) is used as a parameter which is not an indicator but just a simple number?!
