What is a Momentum Indicator? (Explained Simply)
Momentum indicators are tools utilized by traders to get a better understanding of the speed or rate at which the price of a security changes. Momentum indicators are best used with other indicators and tools because they don’t work to identify the direction of movement, only the timeframe in which the price change is occurring. Momentum indicators show the movement of price over time and how strong those movements are/will be, regardless of the direction the price moves, up, or down.
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