ADX (Average Directional Index) Indicator

Creator: J. Welles Wilder

Default period: 14

There are three lines plotted below the chart in the ADX indicator.

1 – Blue line is ADX line

2 – Green line is DMI+ line

3 – Red line is DMI- line

DMI+ is a bullish line. When it is rising, it indicates a bullish trend.

DMI- is a bearish line. When it is falling, it indicates a bearish trend.

ADX line shows the strength of the trend. When it is rising, it shows that the trend in place is becoming stronger.

A strong uptrend is indicated when the DMI+ line is above the DMI- line and the ADX line is rising.

When DMI- line is above DMI+ line and ADX line is rising, it shows a strong downtrend.

Click here to know more about this indicator.

The indicator can be found in the Indicator Digger section of TradePoint & RZone. There are ready conditions in tabular format that can be used to pick stocks based on the condition of this indicator on any charting technique.

The indicator table value in TradePoint & RZone also provides you with a list of all values of this indicator for any group of stocks. This will allow you to compare the readings of this indicator across different stocks.

This indicator is also available in the System Builder of RZone & TradePoint for all charting methods. Using the system builder, you can develop various strategies based on the different conditions already present in this indicator. Additionally, it can be used with other indicators or price patterns to develop effective trading strategies. For any group of stocks and market segments, you can scan and backtest stocks based on those strategies.

The indicator is applicable to all types of charting. Calculated based on the number of columns on P&F charts, bricks on Renko charts, lines on Line-break charts, candles on Heikin ashi charts, and lines on Kagi charts. While the formula and reading of the indicators remain the same, they become more dynamic on these charts.