SMU MoMo Index Showing Little Change

The Steel Market Update Price MoMo Index for flat rolled steel in the U.S. remained positive this week for the 12^th week in a row after four consecutive weeks of being in negative territory. MoMo, a trailing indicator, is based upon the current hot rolled coil (HRC) price weighed against the previous 12-week average spot price as recorded by Steel Market Update. MoMo was measured at 0.50 percent this week, meaning that the current HRC price is slightly above the average price over the previous 12 weeks.

The change in MoMo can be a useful indicator in depicting the severity of price movements. The week-over-week change in MoMo was -0.38 percent this week, up from -0.44 percent the week before. Looking at this change on a 3-week moving average, we see that the trend in HRC price fluctuation has started to turn slightly negative after being relatively flat over the last 7 weeks. The 3-week average change in MoMo is -0.66 percent, meaning that the overall movement in HRC prices over the previous 12 weeks has been very minor.