Re: Indicators and Oscillators
![Quote](images/misc/quote_icon.png)
Originally Posted by
alevin
JTH, you said not useful indicator for every situation, what timeframes and charts do you think ADX less useful for?
It's good that you brought that up because that's one of the things I'm working on. There is a point where the trend can become choppy and when this happens, the ADX becomes less useful. I'm working on defining when to use it and when to ignore it. As always, it is a work in progress.
9. Trend or Not a Trend
Use ADX. The Average Directional Movement Index (ADX) line helps determine whether a market is in a trending or a trading phase. It measures the degree of trend or direction in the market. A rising ADX line suggests the presence of a strong trend. A falling ADX line suggests the presence of a trading market and the absence of a trend. A rising ADX line favors moving averages; a falling ADX favors oscillators. By plotting the direction of the ADX line, the trader is able to determine which trading style and which set of indicators are most suitable for the current market environment.
http://stockcharts.com/school/doku.p...urphy_s_ten_la
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