MomentumReturn value of the Momentum technical indicator of the Nth bar : (close – close of the N-th last bar).
Syntax:
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Momentum[N] |
Calculation:
It is obtained by substracting the x days before Close from today’s Close. X is the parameter associated with Momentum.
Interpretation:
This oscillator has an unlimited range. It is thus not a good overbought/oversold indicator.
However, crossing the 0 level gives good buy/sell opportunities.
It also gives good divergence signals.
A bullish divergence occurs when the stock price” makes new lows while the Momentum fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the Momentum fails to make new highs.
Example:
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mom = Momentum[20] averagemom = average[10](mom) momlow = Momentum[200] if(momlow>momlow[1] AND averagemom[1]>mom[1] AND averagemom<mom) THEN doublemomentumBuy = 1 ELSE doublemomentumBuy = 0 ENDIF RETURN doublemomentumBuy as "Bullish Signal" |
