ADX is used to quantify trend strength. ADX calculations are based on a moving average of price range expansion over a given period of time. The default setting is 14 bars, although other time periods can be used. ADX can be used on any trading vehicle such as stocks, mutual funds, exchange-traded funds and futures.
Many traders will use ADX readings above 25 to suggest that the trend is strong enough for trend-trading strategies. Conversely, when ADX is below 25, many will avoid trend-trading strategies

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ATADX settings


  • Start trending, i.e. ADX moves above the Lower line

Strength Signals

Trending (1.0)When the ADX is above 25 (the lower line)
Strong (0.75)When the ADX is rising and above 20 (4/5 of the lower line)
Medium (0.5)When the ADX is rising and below 20(4/5 of the lower line
Weak (0.25)When the ADX is falling and above 20(4/5 of the lower line
No trend (0)When the ADX is falling and below 20(4/5 of the lower line
The signal multiplies the total combined value of other indicators


PeriodThe number of periods evaluated by the indicator
LinesLower: the threshold for the strenght signals
Strong/Extreme: values visible on the indicator and the strength signal box, but no change in signal value
PlotsThe style of the different plots of the indicator

The ADX indicator does not show you the direction of a trend, but shows you the amount of trending of the price.
In that regard you can compare it with the Choppiness Index.

An ADX value above 25 is regarded as reasonable trending, and a value below 20 as ranging.