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The best analogy I can think of that explains the difference between
velocity and momentum --as I see it-- is that of a rocket launching into
space.
The velocity is the speed at which it travels away from the earth and the
momentum is the force that propels it after the fuel is spent and it begins
to slow down. From a Market perspective, I want to be able to determine a
specific reading on the momentum curve-- i.e. The point where the momentum
drops to zero and the coordinate on the curve where that event occurs. Much
more valuable for trading if referenced to past similar events.
I realize that the mathematicians are probably spinning on their keyboards,
but that's the definition that works for me.
_____________________________________
At 01:06 AM 10/23/98 -0400, you wrote:
><<<Momentum is the measured result of a price movement based on the degree
>of Velocity that was required to produce the result.>>>
>
>I guess I'm unclear of the definition of velocity. Momentum is showing me
>the change in price, but not necessarily "how fast" it is - which is what I
>assumed velocity to mean. But that could be my trouble - an assumption.
>
>Mike
>
>
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