Momentum
Last updated
Last updated
You can access the Momentum Indicator within the TRND PANEL settings. Click on the Gear icon and then make sure the "Momentum" indicator is selected.
NOTE: Like the Color Scheme Capability for TRND PRO, the PANEL has the "Traditional" and "Mono" options you can choose from.
Momentum Indicator Broken-down
Momentum indicators are identifying strength in the movements in the market.
It is important to consider a few things with the Momentum indicator:
Green Candles mean it is in an overall Bullish momentum but there are two shades of Green!
Dark Green means we are in an Overall Bullish Momentum and the momentum if very strong.
Lighter Green Means we are still in an Overall Bullish Momentum but we are in a weakening bullish state. This can indicate we are experiencing a pull back or a potential reversal.
Red Candles mean it is in an overall Bearish momentum but there are also two shades of Red!
Dark red means we are in an Overall Strong Bearish Momentum.
Lighter red means we are in an Overall Bearish Momentum but it is weakening. This can indicate we are experiencing a pull back or a potential reversal.
Always consider the size of the candles.
The taller the candles and the larger the "steps" up and down will indicate to you how strong/quickly the market is moving up or down.
If your candles are plateauing this can be a sign we are experiencing a sideways movement, or we can see an upcoming a pull back or a reversal. "Plateauing" candles can also be sign we are running into a Support and resistance line which may be causing a pull back or sideways movement.
Read when the Market is Oversold or Overbought
There is a built in Oversold and Overbought indicator that overlays on top of the TRND PANEL. The indicator is represented by two zones.
The first zone is placed on the top portion of the Panel between the values of 150-250 and the second zone is at the bottom portion of the panel that helps us clearly read the -150- -250 zone. The 150-250 and -150 - -250 values can be found to the right of the chart on the y-axis.
When the market or candles from the momentum indicator or the pressure lines enter into the upper "overbought" channel we can use that as a sign to be careful and that the market may be due for a pullback. Vice Versa, If the Momentum indicator or the pressure lines drop into the "oversold" Channel we need to be aware that the market may be in oversold position and we can expect a potential pull back.
The "Divergences" Indicator can be also toggled on and off in the "Settings" of the TRND PANEL.
The Divergences Indicator will pick up on Regular and Hidden Movements in the market. Divergences occur when the Momentum indicator within the TRND Panel picks up on underlying data that doesn't match with the price.
For example: In the below market we can see the Momentum Indicator picks up a weakening bullish movement which is represented by a RED "R", the RED line connects the two points where the indicator picked up and began to calculate a weakening bullish movement. The white vertical lines drawn onto the chart help see where the Regular movement was signaled ("R") and what happened after it was indicated.
An example of a Regular Green Movement is below. We can see that after it was signaled we see the Green Line connecting the beginning of the signal and then connecting the Green Regular Movement ("R"). This Green "R" helps us understand there is an underlying weak bearish signal meaning we should eventually see a pullback up
Hidden Divergences, represented by an "H" indicates the underlying movements and patterns that signal a Hidden Bullish movement (Green "H") or a Hidden Bearish Movement (Red "H").
In the example below you can see what a Hidden Green Movement looks like when it is signaled! (White vertical lines help show when the Hidden movement is being calculated and then after the last line we can see what happens when the green "H" is triggered).
