A revolutionary new way to find out that beginning of a trend early using the methods of the popular ADX index. The new system adheres to the market, removes additional requirements, and deals with its activity.
When using the classic ADX indicator, to get a signal confirmation, it is necessary that the ADX line crosses a certain degree 20, 22, 26, etc.It is extremely hard to choose this degree not just for different instruments, but for different periods of the identical chart. Unfortunately, this makes the inventive ADX indicator virtually futile.
The solution proven to be simple, but at the same time conceptual. In the new indicator, we abandon this level altogether. To determine the trend is calculated, a new line crossing DI upwards gives sell signal and crossing -DI upwards gives a buy signal. And at the reverse intersection, it gives a signal for the end of the trend.
The signal line has a sensitivity parameter. The higher its value, the higher the market noise filter on instruments with high volatility. The lower this parameter, the more accurate the signal is. Recommended values are from 5 to 10, (default is 6).
As a bonus, the new indicator has the ability to select the display of information from any standard timeframe.
- Timeframe of ADX (0-current) – the timeframe from which the data for the indicator is taken
- ADX period – the period of the ADX indicator
- Applied price (close, open, etc.) – the type of price to which the indicator will be applied
- Sensitivity of signal line – sensitivity of the signal line (optimal 5-10)
- Averaging method – method for smoothing the signal line