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Trend Indicator: Momentum
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The momentum is certainly the easiest one to compute. The momentum is the difference between today's price and the one of n days before.

With:
P_t today's price.
P_t-n the price at the date t-n

The momentum is:

MO_t = P_t - P_t-n

The problem is to use the correct lag (as it's for the moving average). The most often used are 5, 10, 20, 25 and 28 days.

We will see in the section 'Indicators based on oscillations" how we can amend the formula to build an oscillator (momentum%).

Interpretation

The purchase signal is given by the momentum when it changes from a negative value to a positive and the sale signal when it's from positive to negative.

The signals given by the momentum are often compared to the ones given by one of the moving averages.

Graph Example: Momentum

On the upper side of the graph you see the price line and the 100 days moving average. The momentum 10 days is in the bottom side of the graph. The 0 level is indicated by the green line.