What is ADX?
ADX is derived from the Directional Movement system. The ADX line focuses on the strength of directional movement, while +DI and -DI provide information about which side is dominant.
What does it measure?
Trend strength based on smoothed directional movement.
How is it calculated?
ADX is derived from smoothed +DI and -DI values. The standard calculation typically uses a 14-period lookback.
Common interpretation.
- Rising ADX describes strengthening directional movement.
- Falling ADX describes weakening trend strength.
- ADX itself does not specify whether the trend is upward or downward.
- High ADX can remain elevated even after a trend has already matured.
How traders use it for market context.
- ADX can help describe whether an intraday futures session is developing directional behavior.
- It is generally best interpreted alongside price structure and directional context.