%% Good thing there are certain clues; the trend = your friend. As far as Momo goes ok, but its measured by time,, 3;00 CST ,SPY,S&P 500 NQ, DOW,DIA slows down, same way with a a school zone slow$ traffic @ 3;00. But really that's more time + volume based than Momo. I NEVER worry much about ''knowing''
I'll add that the word "momentum" means different things to different investors If you are a short-term trader or day trader it means movement over a short time period (a few days to maybe a week or 2), or even intraday. In a similar vein is "momentum" in TA. This is usually in this short time frame, it just uses a transform of price such as RSI, MACD etc "Momentum" to a quant means something completely different. When people speak of momentum in quant investing, or the momentum factor, they mean a much longer time frame. Typically using the returns over the last 6-12 months or some kind of longer-term signal (such as the 200-day MA). To add to the confusion, quants speak of 2 "kinds" of momentum (tho they are related): Cross-sectional aka relative momentum aka relative strength means measuring the momentum of one thing vs another, or vs a universe of stocks. So buying the 50 stocks in the S&P 500 with the strongest 12-month returns is an example of cross-sectional momentum The other kind is time series momentum aka absolute momentum aka trend following. This is comparing the asset to itself. So a rule such as buy if the 12-month return is positive, or if the price is above a MA, is an example of this kind. IMO, the word "momentum" is so problematic because of this. Many people end up just talking past each other because they are referring to different things Hope that helps.
There is a strong oscillation around the 5 day moving average, after March 2020 the market regime changed.
I was just thinking this, prior to reading your reply. All of these indicators and classical strategies sounds so logical, good, and smart....in Hindsight on a chart, in a relaxed, calm environment. But in real time....everything works beautifully, prints money.....UNTIL, it Doesn't, That's like spotting a Ghost, COOL, let's follow it....and it's gone, not there no more, when you turned the corner. And now you're back to nothing, square one, at a loss, guessing, waiting. With no understanding, just staring at a wall or the sky. Most traders trade like this. Approach the market like this. And it's completely flawed, with no reasonable hope for actual, sizeable profit and success overall.
If the market is going up look at the distance between successive highs. Is it expanding or contracting? That is how to gauge momentum. Vise versa for down markets. It's direct and easily observable. Avoid any and all so called "momentum indicators". Also don't spend time actually measuring the distance. Just look and estimate.
%% I thought it helped; even if most investors dont really care about momentum. Even though except for the drama kings + drama queens , most investors would not prefer most the gains [ but good Momentum] in last month of 12 /LOL. AS far as ''my only secret '' unquote original poster, for trading being '' momentum ''= not likely @ all/LOL. But its a good question, on momentum.
Many choose to answer to what they think momentum is in reference to their own trading rather than the OP's particular question as to; very short term, a particular time of day for a limited time period (i.e., before work) which should make it obvious they are not going to look hourly, daily, weekly and certainly not 200 period squiggly MA's or what happened in lol 2020.
%% True; partly. But i have found a 200 period or 200day ma quite helpful for occasional small time frame trades; the latter sure make$ a big difference in Momo + price direction. Havent looked much @ 2020 lately-LOL Since you mentioned it ; i seldom trade in first 15 minutes or last 1.5 minutes, generally = price too wild +momentum to wild for me.
FWIW, I trade ES US hours everyday for years. Price will stay in a range until there is a big enough imbalance. The imbalance impact is not linear, but more geometric. The "key" is to see when the threshold is reached AND maintained. So for example, a 3 point move in under a minute is OK, but 5 points is more significant. Add to that the highs/lows keep getting higher/lower (Confirming). Time of day is a big factor. The main problem though is it can be "too late" and you "miss" the fat part of the move. Then on the other hand, you get in "early", but it reverses. Bottom line, there are sweets spots, and the management of the Exits are a major part of the resulting P/L. I.e. every entry should have the exit road maps based on R:R and price action after entry. But full disclosure, I do not trade like this anymore. IMO there are too many ways for it to mess you up manually trading, and auto-trading, shows there are better ways with the same or better risk profiles.