Chande Momentum Oscillator

The Chande Momentum Oscillator (CMO) is a pure momentum oscillator that identifies short-term excesses in market momentum. It is a variant of the RSI, from which it differs because the CMO directly measures the momentum (in the numerator of the formula it contemplates the momentum of positive days and negative days, while the RSI uses in the numerator the momentum of only positive days). The CMO does not use damping mechanisms within its formula, so it does not blunt the short-term excesses of the momentum, while the RSI performs the calculations on damped data. The CMO scale varies from -100 to +100, so you can see at a glance the net momentum (above or below zero), while the RSI, with a scale from 0 to 100, must use as delimiter of the net momentum value 50.