Momentum Trading Explained

How to trade with momentum & read the momentum list

Intro to Momentum Trading:

Trading a Momentum Strategy is not for everyone, but it can be very rewarding when executed correctly. In this article, I will describe how a Momentum Strategy works and when it can be effective to use. Using momentum as a factor in your investment strategy can greatly improve your results and increases your odds of achieving high ROI trades when a momentum trading system is set up and executed well.

Momentum Strategy Bitcoin Cash Trade (+18.6%)

Essentially, momentum trading is a strategy in which you buy assets that have recently increased in price in hopes of a continuation in the trend, and sell assets that have decreased in price. This strategy can be adapted to fit different markets and time frames. There are three main structural and physiological phenomenons that underpin the momentum anomaly:

Information is both diffused and acted on slowly by market participants

Liquidity forces large investors to spread out transactions over time

Humans extrapolate recent performance, leading to herd mentality

The Momentum List is our way of keeping a live watch on the top momentum crypto assets. You can watch our list in real-time on our social media feed (Twitter, Telegram, Discord) and trade your own momentum strategy with this information. Even if you do not trade with a momentum strategy, our list can help you track the best performing crypto-assets over time. The list will track whether the asset is strengthening or weakening and can help determine optimal points to buy or sell.