This thread is seven years old and Rahula hasn't posted in five, so you may not get an answer. But there's nothing especially difficult about it. Is price going up or down? What is the pace of the movement? The duration? What Ed Seykota may or may not have said is not pertinent, particularly since one often misunderstands what one has read.
The Difference Between Trend and Momentum
- Thread starter Rahula
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This thread is seven years old and Rahula hasn't posted in five, so you may not get an answer. But there's nothing especially difficult about it. Is price going up or down? What is the pace of the movement? The duration? What Ed Seykota may or may not have said is not pertinent, particularly since one often misunderstands what one has read.
Quote from bankroll:
So, they are not different methodologies? There are no different methodologies in trading?
Trend and momentum? Depends on how one defines them. Quite frankly, I really don't understand how "trend traders" define trend since they are so willing to accept extraordinary drawdowns. To me, if the drawdown is that heavy, how on earth is one defining trend?
For me, trend is simply the general direction: up, down, or sideways (though I prefer to consider sideways as trendlessness). Momentum is defined by the pace, duration, and extent, which is how Wyckoff defined it, and I've always done well with that. Momentum may slow and the character of the trend may even change, but a change is not a reversal, so I'm much more interested in who's in charge, buyers or sellers, and I look for signs that the balance is shifting.
there is no expectation of reversal in a trend, at least as long as you believe in the trend, even though in reality the reversal could happen
while momentum is one time shot with an expectation that it will not last
at the end of the day, they describe the same things, but only our interpretations differs
all of them are random walk, so it's always a question of time before they snap back. The trick is to select carefully the duration, and see how it is stable.
while momentum is one time shot with an expectation that it will not last
at the end of the day, they describe the same things, but only our interpretations differs
all of them are random walk, so it's always a question of time before they snap back. The trick is to select carefully the duration, and see how it is stable.
MR DB said since no answer in 5 years, may not get one
Mr bankR;
I will make a few[layman/plain english] comments on momo , murray trend turtle writes;
market maker Joshua Lukeman[Book = Market Makers Edge] says mo mo is ''price speedometer''
Having tested many momentum indicators of various time frames; i hate it-it gets you OUT OF A TREND way to early!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Since you get out of a GOOD trend early or late;; i hate mo- mo indicator, they get out WAAAAAAAAAAAAAAAAY to early.
And never forget the elite question'' why is my mo m o- so slow???????'' An elite trader says'' recheck you r momentum indicator;; its WRONG'' LOL Great, accurate, elite trader line,LOL%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
Wisdom is profitable to direct
as stated - it depends on how you define them.
You can trade with the trend, against the momentum.
You can trade against the trend and with momentum....
if anything trend following and trading might be described as a state of mind (run your profits), and momentum as the current movement within a trend. (however you wish to define it)
Its the same as support and resistance....many instances people say they are trading support when in looks to me as they are trading momentum of an existing trend.
To trade support usually means you are buying with the trend against current momentum....
Can momentum be negative....? does it only ever exist with the dominant trend, or does momentum really become simply continuation of a trend, or a retracement of a trend? Is momentum any move in the same direction of the dominant trend or a move of a prescribed amount or requiring some other measure.
Ask 100 people get 100 answers. One you define it yourself then it usually clear things up for what you are trying to do.
You can trade with the trend, against the momentum.
You can trade against the trend and with momentum....
if anything trend following and trading might be described as a state of mind (run your profits), and momentum as the current movement within a trend. (however you wish to define it)
Its the same as support and resistance....many instances people say they are trading support when in looks to me as they are trading momentum of an existing trend.
To trade support usually means you are buying with the trend against current momentum....
Can momentum be negative....? does it only ever exist with the dominant trend, or does momentum really become simply continuation of a trend, or a retracement of a trend? Is momentum any move in the same direction of the dominant trend or a move of a prescribed amount or requiring some other measure.
Ask 100 people get 100 answers. One you define it yourself then it usually clear things up for what you are trying to do.
