The ADX (Average Directional movement Index) Indicator

#11
Hi,

Can you suggest any website which gives +DI, -DI, ADX & ADXR for our NSE & BSE stocks. I was able to download FCharts and could get NSE data daily. But this version does not have ADX indicator.

It will be really great if some body can help me out.

Thanks,
Rao
 
#14
Hi Guys,

This forum looks to be very useful one but only got to see today with this thread and immediately registered.:)

Now coming to the point, all the posts here superbly explained the about ADX and how to read it. Could anyone help us in a guiding to a chart site(s) which gives ADX for Indian stock and Commodity markets.

Regards,
Diwakar
 
#15
Hi Guys,

This forum looks to be very useful one but only got to see today with this thread and immediately registered.:)

Now coming to the point, all the posts here superbly explained the about ADX and how to read it. Could anyone help us in a guiding to a chart site(s) which gives ADX for Indian stock and Commodity markets.

Regards,
Diwakar
http://www.icharts.in/

Currently only stock charting is available. Futures (Index & Commodity) will be added in the near future.

--SwingTrader
 

johnnypareek

Well-Known Member
#16
Well, This my 1st post.

I use ADX indicator with MACD. when both are in buy mode n adx is above 25 go long and sell when any one of them reverse cross. When both are in sell mode, short is my fav.
 
#17
Hi

While ADX is wonderful "trading system" by itself, there is lot of confusion about it. First confusion is about its level - whether it should be 20 or 35 or 30 or 40. Second confusion is about the period taken for ADX calculation - should it be 7,8, 14, 20 or 28. Third, how to use it for entry and exit. I have spent countless hours on this wonderful trading system and derived certain rules. But before influencing the forum and imposing my ADX trading rules, I would like to hear about your findings. PLEASE APPRECIATE that ADX-DMI TRADING SYSTEM IS VERY VERY WONDERFUL STANDALONE SYSTEM. IF YOU HAVE MASTERED IT, YOU NEED NOT SEARCH FOR ANY SYSTEM INCLUDING, RMO, KWICKPOP, ATM-RMO etc.
GG Shah
 
#18
Greetings,

glad someone else has looked at Directional Movement - a very good method of quantifying stock price movements in order to infer trending indicators. This concept was developed by Welles Wilder (the same person who pioneered the RSI technical indicator).

You've got the basics of how to infer up and down trends based on crossovers between the 14-day +DI and the 14-day -DI along with the ADX value. In Wilder's book "New Concepts in Technical Trading Systems", he also insists that the ADXR value be 25 or greater to indicate that the stock is trending. The calculations can be fairly complex and are really tedious if you're trying to track more than a few stocks.

I have looked at many online sites for the calculations but none provided the details - that's why I ended up buying the Wilder's book. Now there's a free online site that performs these calculations on a daily basis across hundreds of stocks and then flags the trending stocks - http://www.dmtrend.com
Sir,
From your post it transpires that (i) You are fortunate because you possesss Wilder Welles original book, it is both expensive and prestigious book. (ii) Should you have courage to work with calculations, you could get the formulas from Equis International - equis.com/customers/resources/formulas/ and you could develop Spreadsheet each page devoted to separate stock. I have found that study with DMI would be complete if one study the RSI alongwith DMI. Anyway, the purpose of this post is to try to develop Set up with formulas available free in Metastock Index file.

I have developed the ADX (with +DI/-DI) and it is helpful to me in earning money confidently through swing trading. The ADX can be developed for 5 days,7,9,11 and 14 days. I have found the signals generated by 5-days for ENTRY or EXIT may be somewhat exaggerated. The 11-day ADX is fine, smoothened reasonably and signals generated by it are effective also for swing trading purpose. 14-days are somewhat slow for swing trading but good for long term trading purpose.
 
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Apurv7164

Well-Known Member
#19
hey guys....

Here is something I have to share for ADX... I found this trading system somewhere (don't remember but mostly Larry Connors one of the book)...

this trading system is in my list along with other systems for swing trading... Kindly go through and give your opinion as well as feel free to try at your risk... ;)

1. ADX must be greater than 25
2. 14 days +DI reading must be higher than 14 days –DI reading
3. Wait for the market to have 1 2 3 correction i.e. 3 consecutive intraday lower lows or 2 lower lows and one inside day
4. On day 4 only, buy 1 tick above day 3 high
5. Initial stop loss should be placed day 3 low.

~ Apurv
Still not an analyst....
 
#20
I am into intrady trading, and would like to use ADX. My question is what period is best suited for intraday period? 14 day (default) OR sumthing different......
 

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