ADX (Average Directional Index)
Measures how strong a trend is, whatever its direction.
Technical indicators
Live NSE examples below
What is ADX?
The Average Directional Index, another Wilder invention, answers a question most indicators skip: is there a trend at all? ADX rises when price moves persistently in one direction, up or down, and falls in choppy markets. Its two companion lines, +DI and −DI, show which direction is winning.
Formula
+DM = today's high − yesterday's high (if larger than the down-move, else 0)
−DM = yesterday's low − today's low (if larger than the up-move, else 0)
+DI = 100 × Wilder avg(+DM, 14) ÷ ATR(14); −DI likewise
DX = 100 × |+DI − −DI| ÷ (+DI + −DI)
ADX = Wilder avg(DX, 14)
How to read it
- ADX above 25 means a trending market; below 20 a range. Trend-following tools work best above 25, oscillators below 20.
- +DI above −DI with a rising ADX is a strengthening uptrend.
- A very high ADX (above 40-50) that starts falling often marks a trend that is tiring, even while price still rises.
Common mistakes
- Reading ADX as bullish or bearish. A high ADX can be a strong downtrend; the DI lines give direction.
Live: NSE stocks matching this today
Stocks in strong trends (ADX > 25) 364
| Stock | Change % | ADX (14) | +DI (14) |
|---|---|---|---|
| PASHUPATIPashupati Cotspin Limited | -10.00% | 65.12 | 47.18 |
| SBCSBC Exports Limited | -0.55% | 51.91 | 31.61 |
| LTTSL&T Technology Services Limited | +2.23% | 50.58 | 29.65 |
| CUBEXTUBCubex Tubings Limited | +2.00% | 50.47 | 49.61 |
| TANLATanla Platforms Limited | -0.51% | 50.07 | 34.65 |
| PVRINOXPVR INOX Limited | +0.26% | 49.38 | 34.86 |
| MRFMRF Limited | +6.73% | 48.61 | 32.62 |
| FUSIONFusion Finance Limited | +3.30% | 48.52 | 27.12 |
Use it on Flash Finance
Related concepts
SuperTrend indicatorA volatility-based trailing line that flips between buy and sell.MACD (Moving Average Convergence Divergence)Trend-following momentum from the gap between a fast and a slow moving average.Moving averages (SMA, EMA, 50 and 200 DMA)The average closing price over a window, used to define the trend.
