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The ADX Advanced trading indicator is a modification version of the ADX indicator included in the standard forex set. Its calculations, as in the case of the standard version, are aimed at determining the direction and strength of the current market trend. The indicator is presented in the lower window of the price chart in the form of a histogram that changes its color under certain market conditions. Depending on the current conditions, the trend is determined, and at the same time the trade that opens at that moment.
The ADX Advanced indicator is suitable for trading any currency pairs on any timeframe.
Input parameters
There are several sections in the indicator settings. Thus, the Input Parameters section is responsible for its technical work, the Colors section is responsible for its general visualization, and to add signal levels to the indicator window, the Levels section is used.
- ADXPeriod - indicator calculation period value. The default value is 13.
Indicator signals
The ADX Advanced indicator is very easy to use since the algorithm for using it is similar to using other histogram indicators. To open a certain trade using the indicator, it should be taken into account the direction and strength of the current trend, which are determined by the color of the histogram bars. If the current trend is upward, buy trades are opened, if the trend is downward-sell trades. When the trend changes, trades are closed in both cases.
Signal for Buy trades:
- At least three columns of the histogram have a color with a growth value. In this case, a new column is formed above the previous one.
Upon receipt of such conditions on a signal candle, a buy trade may be opened, due to the presence of an uptrend. At the moment of its change, namely when the color of the histogram or its direction changes, the trade should be closed and a new one should be considered.
Signal for Sell trades:
- Three columns of the histogram have a color with a falling value and each column is formed below the previous one.
A sell trade, due to the presence of a downtrend, can be opened immediately upon receipt of such conditions. The current trade should be closed and a new one should be considered upon receipt of reverse conditions from the indicator. At this moment, a change in the current trend is possible, which will allow considering the opening of new trades.
Conclusion
The ADX Advanced indicator is very effective as its calculations are based on a modification of a very powerful trading algorithm. Although the indicator is very easy to use, it is recommended to practice on a demo account first.
