SMU MoMo Index Remains in Positive Territory

The Steel Market Update Price MoMo Index for flat rolled steel in the U.S. remained positive for the second consecutive week after being in negative territory for the prior six weeks. MoMo, a trailing indicator, is measured as a percentage and shows the relation of the current hot rolled coil (HRC) price movements against the previous 12-week average spot price as recorded by Steel Market Update. MoMo was measured at 0.93 percent this week, meaning that the current HRC price is slightly higher than the average price for the last 12 weeks.

The change in MoMo can be a useful indicator in depicting the severity of price movements and evaluating the directional trend prices may be in. The week-over-week change in MoMo was +0.13 percent, the fifth consecutive week-over-week increase. Looking at this change on a 3-week moving average, we see that the trend in HRC price fluctuation is showing an overall positive direction for HRC prices for the fourth week in a row after being negative for the previous eight weeks. The 3-week average change in MoMo is +0.35 percent, down from +0.83 last week.