Momentum trading is an investment strategy that focuses on buying securities that have shown an upward price trend and selling those that have shown a downward trend. Traders believe that assets that are moving in a particular direction will continue to do so for some time, allowing them to profit from these price movements. This approach often involves analyzing market trends and using technical indicators to identify potential entry and exit points. Momentum traders may look at factors such as stock price, volume, and market sentiment to make informed decisions, aiming to capitalize on short-term price fluctuations.