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Momentum

Momentum is price change between now and N days ago.

Momentum refers to the tendency of prices to continue moving in the same direction over time. It is a core concept in technical and quantitative trading.

In oil markets, momentum can be driven by inventory trends, macroeconomic data, or geopolitical developments. Strong momentum often attracts speculative flows.

Momentum-based strategies seek to enter trades aligned with prevailing trends. These strategies can reinforce price moves.

However, momentum can reverse abruptly, particularly around news events, making risk controls essential.