Elemantary School: ADX (Average Directional Index) lesson not the same as ADX in the real world?

Beginner Questions
1

Hi everyone,

Am I the only one that realizes that the lesson on ADX doesn’t reflect ADX in the real world?

The examples and illustrations used in the ADX lesson show that the ADX uses only one line. However, I tried practicing with using the ADX on my demo account on MT4 and it displays 3 lines instead of one. Same thing with TradingView.

Now I’m confused :confused:

Am I missing something here?

2

The principal line on the Average Directional Movement indicator is ADX. Normally this is the only line you would see when you use this indicator and its probably all you’ll need.

But you can set the indicator to show three other lines. These are +DI and -DI, showing Positive and Negative Directional Movement, plus ADXR, the Average Directional Index Rating. I can’t explain what they do - I’ve never heard anyone saying the extra lines are useful in any way .

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3

Okay thanks. Those two extra lines are really messing things up lol

4

The simplest interpretation of the DI+/DI- lines are the crossovers.

  • DI+ crossing over DI- when ADX >25 = strong uptrend
  • DI- over DI+ when ADX >25 = strong downtrend

An explanation of this is illustrated in this article, with example charts provided.

Average Directional Index (ADX) [ChartSchool]

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