Average Directional Index (Trend Strength)

Previous Lesson                                                                                          Next Lesson

The Average Directional Index (ADX)  indicator takes values fluctuating between 0 and 100 and it signals how strong a Trend is.

ADX (Average Directional Index) value above 50  a strong  Trend exists.

ADX (Average Directional Index) value bellow 20  a weak  Trend exists.

Note that it indicates only wether a Trend exists and its strength and it does not indicate its direction.

average directional index

It is important to use this indicator in addition to your trend analysis to ensure that there really is a trend and we are not just stuck in a range.

Previous Lesson                                                                                          Next Lesson