Market Momentum

AAA

DEFINITION of 'Market Momentum'

A measure of overall market sentiment, calculated as the change in the value of a market index multiplied by the aggregate trading volume occurring within the index components.

INVESTOPEDIA EXPLAINS 'Market Momentum'

Market momentum can be a good indicator of overall market changes which are likely to continue in the near future. It is important to understand that momentum considers not only changes in price level, but also volume. For example, if the Dow Jones Industrial Average (DJIA) was up significantly over several trading days, this price movement would be said to have more force, or momentum, if it occurred with heavy trading volume as opposed to low volume.

RELATED TERMS
  1. Dow Jones Industrial Average - ...

    The Dow Jones Industrial Average is a price-weighted average ...
  2. Momentum

    The rate of acceleration of a security's price or volume. The ...
  3. Market Index

    An aggregate value produced by combining several stocks or other ...
  4. Momentum Investing

    An investment strategy that aims to capitalize on the continuance ...
  5. Index

    A statistical measure of change in an economy or a securities ...
  6. Market Sentiment

    The overall attitude of investors toward a particular security ...
Related Articles
  1. Measure Momentum Change With ROC
    Active Trading

    Measure Momentum Change With ROC

  2. Investors Intelligence Sentiment Index
    Technical Indicators

    Investors Intelligence Sentiment Index

  3. Introduction To Momentum Trading
    Trading Strategies

    Introduction To Momentum Trading

  4. Use The Momentum Strategy To Your Advantage
    Trading Strategies

    Use The Momentum Strategy To Your Advantage

comments powered by Disqus
Hot Definitions
  1. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  2. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  3. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  4. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  5. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
  6. Over The Counter

    A security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, etc. The phrase "over-the-counter" ...
Trading Center