TC Momentum
This indicator shows the momentum of Price Action. It provides a confirmation for your trading and will
help with staying in trades. It is best used for short term trend trades. As with any Momentum trade
indicator it has to be understood to give you the best value.
When you first look at this indicator it looks simple. When the signal is green the price moves up, when
the signal is red the price moves down. That is the case for short term transitions, however for long
slower trends it is not the case.
As you can see in the chart above, the momentum signal is moving up (going closer to the zero line) and
the price is moving down. This is telling us that the bears are losing strength and the price should be
going back to the average line. Once it crosses the zero line the price should moves up if the
momentum line continues in that direction.
Hence, Momentum indicators are not as simple as they look. 
The settings of the Indicator:
Price on Close
SPriceAction – This sets the response to price action you desire. (I use values from 12 -24)
Baseline – This sets the base line response. I leave this at 50)
Top – Sets the top range for the grid.
Bottom – Sets the bottom range for the grid.
Smooth – Sets the smoothing of the line. As with any averaging the smoother the signal the more
delayed it is. (I use values from 2-3)
To begin with, the indictor grid size should be adjusted for each symbol and chart type you use this
indicator for. The process is not complicated. Set the Top and Bottom setting to match the range of the
indicator, so the top dark magenta and bottom dark magenta lines are close to the maximum value
show on the chart.
You should match these values to the style of trading you do. Just because I use these ranges does not
mean you should, as my style of trading could be different than yours.
Risk disclaimer:
Trading is a risky business, you have the potential for profitability and loss. Before you decide
to participate in any trading market or use any indicator, you should carefully consider your
investment objectives, level of experience and risk appetite.
About Jay
I am a full time trader. I started trading as a pure technical trader. As I continued to learn and improve
my trading abilities, I added Price Action (Candlestick). I consider it just another form of technical
trading, but others do not. I have built several indicators to enhance my trading, this is just one of them.
If you like what you see and want to move to the next level. I offer training and mentoring for Future
traders. My rates are $150 per hour for Training per person and $150 per month for mentoring (up to 2
hours per month). I will only Mentor people that I have trained. (Hence, you must have at least one
hour of training to qualify for mentoring). I do not give finical advice! I will only help you with the
training on the indicators, how to read charts and the thought processes that could help you improve
your trading. I will trade live with my students and will let them know when I am taking a trade. All
training is done using TradeStation with as close to live data as possible via a Web service like Go to
Meeting. I believe looking at current data is the best way to learn to trade. The right edge of the chart
is the hardest thing to understand and learning it will make you a more successful trader. If training
over the weekend, then the training will still be done a bar at a time from Friday’s data.
People ask why I train, I do not need the money. I do it to help others and have interaction with
passionate people. I charge the money to weed out the people that are not serious about trading.
“No indicator is perfect”
However, an indicator should increase your odds of winning. By how much is the question. Of course it
then must match a strategy to be successful. I help with both.