Momentum Silver Technical Analysis & Momentum Oscillator Trading Signals

Momentum technical indicator uses mathematical equations to calculate line of plotting. Momentum measures velocity with which xagusd price changes. This is calculated as the difference between the current xagusd price candlestick & the average xagusd price of a chosen number of xagusd price bars ago.

Momentum represents the rate of change of the xagusd price over those specified time periods. The faster that xagusd prices rises, the bigger the increase in momentum. The faster that xagusd prices decline, the bigger the decrease in the momentum.

As the xagusd price movement starts slowing down the momentum will also start to slow down and return to a median level.

Momentum

XAGUSD Trading Technical Analysis & How to Generate Trading Signals

This silver technical indicator is used to generate technical buy & sell trading signals. Three most common techniques of generating trading signals used in silver trading are:

Zero Centerline XAGUSD Trading Crossovers XAGUSD Trading Signals:

• A buy silver signal is generated when Momentum crosses above zero
• A sell silver signal is generated when Momentum crosses below zero

Overbought/Oversold Levels:

Momentum is used as an overbought/oversold indicator, to identify potential overbought & oversold levels based on previous readings: the previous high or low of the momentum is used to figure out the overbought & oversold levels.

• Readings above the overbought level mean silver is overbought and a xagusd price correction is pending
• While readings below the over sold level the xagusd price is oversold and a xagusd trading price rally is pending.

Silver Trend-Line Break-outs:

Silver Trend lines can be drawn on the Momentum indicator connecting the peaks and troughs. Momentum begins to turn before xagusd price therefore making it a leading indicator.

• Bullish reversal - Momentum readings breaking above a downward silver trendline warns of a possible bullish reversal silver signal while
• Bearish reversal - momentum readings breaking below an upward silver trend line warns of a possible bearish reversal xagusd trading signal.

Technical Analysis in Silver Trading