What is ADX Indicator?
What you need to know about
ADX Indicator: What is the
ADX Indicator, how is it calculated, and how is it interpreted?
ADX Indicator was developed by J. Welles Wilder, who created many indicators, including the RSI Indicator. ADX Indicator is used to understand the power of the trend. This Indicator, when used in correct combinations, generates essential signals about the market.
ADX calculation
ADX takes values between 0 and 100. ADX Indicator is rarely seen above the 50-60 band.
If the ADX value is below 20, it is in the
weak trend; Over 40 indicates a
strong trend. Derived from the Positive Directional Indicator (+ DI) and Negative Directional Indicators (-DI) developed by Wilder,
ADX also guides the investor regarding the trend start and end. The movement that starts below 20 and towards through above 20 marks the beginning of the trend.ADX Indicator is generally not used solo; this Indicator is mostly used to support and verify the primary strategy.
J. Welles Wilder recommends using the ADX Indicator with the ‘Directional Movement Indicator.
How to Add ADX Indicator?
The ADX Indicator can be easily used through the Meta Trader platform; as we have mentioned in all other content, we publish on the topic.
Thanks to its useful and straightforward interface, this platform facilitates access to the desired information, and multiple indicators can be worked simultaneously. The indicators selected from the left part of the screen can be easily analyzed by dragging them to the same window.