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Checking market sessions…

ADX and DMI: measuring trend strength

ADX tells you whether the market is trending or ranging; +DI and −DI tell you which side is winning.

What ADX/DMI is

J. Welles Wilder's Directional Movement system (1978) has three lines: +DI (upward pressure), −DI (downward pressure) and ADX (trend strength, regardless of direction).

On TradingViewDirectional Movement Index (DMI) 14, 14 or Average Directional Index
ADX < 20Weak, ranging market
ADX 20–25A trend is forming
ADX > 25Clear trend; > 40 very strong

How to use it

  • Use ADX as a filter: above 25, use trend strategies (MAs, Supertrend); below 20, use range strategies (Bollinger, RSI 70/30).
  • +DI crossing above −DI while ADX is rising is bullish; the opposite is bearish.
  • ADX turning down from above 40: the trend is losing steam, consider taking partial profit.
Watch outA rising ADX only means the trend is getting stronger, even when it is a downtrend.

Try it on a chart

Educational content only, not investment advice. Practise on a demo account before using real money.