By submitting your email, you agree to our Privacy Policy and Disclaimer.

Average Directional Index (ADX)

The Average Directional Index (ADX) was developed in 1978 by J. Welles Wilder. It is a commonly used as an indicator to measure the strength of a trend. High readings indicate a strong trend and low readings indicate a weak trend. The ADX will range between 0 and 100. Typically, ADX readings below 20 indicate trend weakness, and readings above 40 indicate trend strength. When a trader is using the ADX, he is generally looking for a high ADX reading. This would signify that a trend is already developed and a good trading environment exists.

A very important part of understanding the ADX indicator is to recognize that this indicator only denotes the strength of a trend and not necessarily which direction the trend is moving. Therefore, careful analysis of the existing trends and potential trend reversals is important to successfully use the ADX.

Free Membership

Sign-up for this top rated Penny Stock Newsletter

Free Membership

Join Now

And Let The Profit gains begin! has a zero tolerance spam policy. All subscribers are opt-in, and can unsubscribe at any time. We will never sell or redistribute your email to any 3rd party.