5.0 ADX indicator trading instructions

http://www.capexforextrading.com/forex-technical-indicators

The ADX indicator (Average Directional Index) is amongst the most widely used indicators in Forex trading. The reason for its use is because it provides us with 2 factors:

1. It tells us if the market is trending
2. It shows us how strong that trend is

It's purpose is to allow us to get into trends just after they are formed and get out before the market reverses back.

The period setting for the ADX indicator is 14 (this is a default setting) and you should be using this setting if you are trading any time frame at or above H1. If you are trading time frames that are lower than H1, then you should use a period setting such as 10.

We are looking for 2 factors when trading the ADX indicator:

1. A cross over the 25 line to indicate a trend is likely to happen
2. ADX indicator needs to rise to show us that trend strength is increasing.

It is only at this point that we should take the trade. One thing to bear in mind is that the ADX indicator is a lagging indicator so it can take time to adjust to prices. This is why you may find that a few trades are misses.

Видео 5.0 ADX indicator trading instructions канала Capex Forex Trading