ADX Power in trading

[fadly fahmi]

The Average Directional Index (ADX) is an indicator that is well known as a tool for measuring trend strength. ADX was popularized in the 70-80s by Welles Wilder. When combined with DI+ and DI-, ADX can also generate BUY or SELL signals.

ADX translation

The purpose of ADX is to show whether the market is trending or is in a trending area. So, the first thing we must remember is, DIRECTION should not be translated as BUY or SELL, but DIRECTION determines the STRENGTH OF TREND. Increasing ADX = STRONG UPTREND and increasing ADX = STRONG DOWNTREND.

ADX < 20 : Non Trending Market
ADX > 20 and ADX < 40 : There is a trend that is moving. BUY or SELL determine with your indi, but don't use indi Oscillator (such as RSI)
ADX > 40 : Strong trend
ADX > 50 : Trend Extreme

 

[John Miller]

Uncover the inside mystery of the market. I know uncertainty and losses fuel your fear but you shouldn’t shelter your fear at any cost.When a trader has enough knowledge of trading, he or she doesn’t fear trading any more.

 

[Charles Agustin]

Newbies can’t derive profit from the market moderately just because they don’t have sufficient knowledge. Market’s direction should be guessed to trade in the right trading range.