• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Stock Capturing the Momentum Phenomenon – Nvida vs Tesla
Stock

Capturing the Momentum Phenomenon – Nvida vs Tesla

by February 19, 2024
by February 19, 2024 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

The momentum phenomenon has been a fixture in the US equity markets for decades. There are two types of momentum to consider: absolute momentum and relative momentum. Absolute momentum refers to the underlying trend, up or down. Relative momentum quantifies the strength of the uptrend and compares it to other stocks in the index. A dual-momentum strategy uses both types of momentum to trade the strongest stocks in an index. Let’s look at two examples.

The chart below shows Nvidia (NVDA) with its 200-day SMA on the price chart and the Percent above MA (1,200,1) in the indicator window. NVDA moved above its 200-day SMA in January 2023 and remains well above this long-term trend indicator. Absolute momentum is bullish, which means the stock is in an uptrend.  

We now need to quantify the strength of this uptrend. The indicator window shows the percentage difference between the close and the 200-day SMA. This indicator gives us a “number” we can use to measure the uptrend and compare performance. For example, the close was 20.38% above the 200-day SMA on December 7th. Percent Above MA is one of 11 indicators for the TIP Indicator Edge Plugin (here)

The next chart shows Tesla (TSLA) for a comparison. TSLA was also above its 200-day SMA on December 7th and in an uptrend (absolute momentum). Relative to NVDA, however, TSLA was not as strong because it was only 7.95% above its 200-day SMA.

I chose December 7th because that is when the Composite Breadth Model at TrendInvestorPro turned bullish and our momentum strategies became fully invested. We run Dual Momentum Rotation Strategies for Nasdaq 100 and S&P 500 stocks. Both strategies chose NVDA as one of the ten stocks for their respective portfolios.

These strategies performed very well from early December to mid February with big gains coming from AVGO, CRWD, PANW, LLY, META and NVDA. Like the broader market, these strategies are extended and ripe for a pullback (drawdown). I am not looking to time a pullback or drawdown, but would note that drawdowns can provide opportunities to enter strategies. Click here to learn more about our strategies and see detailed performance metrics.

/////////////////////////////////////////////

You Might Also Like
  • Stock Market Indexes Keep Setting New Highs: How Much Higher?
  • Bonds: Don’t Forget the Long-Term Trend
  • NVDA at a Crossroads: Decoding the Signals From Atop a Cloud
  • Stocks Soar, Energy Prices Spike: Are Geopolitical Tensions to Blame?
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Dow tumbles 500 points, posts worst day since March 2023 after hot inflation report
next post
With The Top 10 Picks In The Stock Market DRAFT, EarningsBeats.com Selects…

You may also like

Ongoing Sector Rotation Out Of Defense Into Technology

February 21, 2023

The Best Traders ALWAYS Cherry-Pick Their Setups

November 8, 2023

Stay Ahead of the Markets with AUTOMATED Portfolio Reports

April 13, 2024

Week Ahead: NIFTY Likely To Stay Sluggish; Multiple Resistances Are...

November 9, 2024

The Ord Oracle March 6, 2023

March 7, 2023

Stock Market Regains Bullish Edge: Can Geopolitical Tensions Change Its...

September 27, 2024

Price Reversals from Recent Highs in Stocks

February 7, 2023

AU Surges Above Resistance: Here’s How to Take Action

April 1, 2025

Don’t Even Think About Investing Without Addressing These 10 Essentials...

September 12, 2023

MEM TV: Nasdaq Flat But These Top Areas Outperform!

December 2, 2023

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Nike pushes back Skims launch with Kim Kardashian due to production delays

      June 19, 2025
    • The Fed Is Getting It Wrong AGAIN As They Hold Rates Steady

      June 19, 2025
    • DOJ seizes record $225 million in crypto tied to global ‘pig butchering’ scams

      June 19, 2025
    • Feeling Unsure About the Stock Market’s Next Move? These Charts Can Help

      June 18, 2025
    • Amazon expects to cut corporate jobs as it relies more on AI

      June 18, 2025

    Popular Posts

    • 1

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 3,599 views
    • 2

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,874 views
    • 3

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,577 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,541 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,416 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,140)
    • Investing (538)
    • Stock (2,620)

    Popular Posts

    • 1

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 2

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 3

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Nike pushes back Skims launch with Kim Kardashian due to...

      June 19, 2025
    • The Fed Is Getting It Wrong AGAIN As They Hold...

      June 19, 2025
    • DOJ seizes record $225 million in crypto tied to global...

      June 19, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,140)
    • Investing (538)
    • Stock (2,620)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Equities Remain in “Go” Trend as...

    October 21, 2024

    Investors Await CPI and Bank Earnings:...

    January 15, 2025

    Odds Favor Further Selling This Week...

    October 22, 2023
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here