Average Directional Movement Index
Overview
The Average Directional Movement Index is an indicator designed to measure the strength and direction of a trend. The indicator consists of three components: the plus directional indicator (+DI), minus directional indicator (-DI) and the Average Directional indicator.
To calculate the directional movement in a trend (up or down) a range is determined by comparing today’s high and low with yesterday’s close. If the largest part of today’s range is above yesterday’s range, the directional movement is plus. If the largest part of today’s range is below yesterday’s range, the directional movement is minus. If today’s range is within yesterday’s range, then directional movement is zero. The Average Directional Movement Index is calculated as the average of the directional movement indicators.
To add the tool to your chart, select the tool from the Price tool group, and left-click on the chart to add the tool. Optuma will then draw the tool in a window below the chart using the default settings.
Scripting Function: ADX()
Actions & Properties
Actions
Copy Data to Clipboard: Will copy the tool’s values to the clipboard which can then be inserted into a spreadsheet, for example, allowing for further analysis.
Add to Toolbar: Adds the selected tool to your custom toolbar.
Apply Settings to All: When multiple Average Directional Movement Index tools have been applied to a chart, page or workbook, this action can be used to apply the settings of the one selected to other instances of the tool. This is a great time saver if an adjustment is made to the tool - such as line colour - as this allows all the other Average Directional Movement Index tools in the chart, page or entire workbook to be updated instantly.
Copy Tool: Allows you to copy the selected tool, which can then be pasted onto a different chart window.
Move to Back: If the tool is displaying in front of other tools or indicators clicking this action will move the tool view to the background.
Move to Front: If the tool is displaying behind other tools or indicators on the chart, clicking this action will bring the tool to the forefront.
Restore Default Settings: Click this action if you have adjusted the default settings of the tool, and wish to return to the standard properties originally installed with Optuma.
Save Settings as Default: If you have adjusted any of the tool’s properties (colour, for example) you can save the adjustments as your new default setting. Each time you apply a new Average Directional Movement Index to a chart, the tool will display using the new settings.
Delete: Deletes the tool from the chart.
Properties
Tool Name: Allows you to adjust the name of the tool, as it’s displayed in the Structure Panel.
Base ADX: Allows you to increase or decrease the number of bars that are used in the calculation.
Show ADXR: When selected the Average Directional Movement Index Rating will be displayed. The ADXR component is essentially a moving average applied to the ADX indicator.
ADXR Interval: Only displays when Show ADXR has been enabled. This field sets the moving average value for the ADXR, the default value is 14.
ADXR Style: This option expands to show the following:
- Plot Style - Allows you to change how the ADXR Up Style is displayed on your chart. There are 6 options available: Line, Dot, Histogram, Step, Shaded, and Shaded Step.
- Line Style - The Line Style property allows you to adjust the type of the line displayed. There are 8 options available: Solid, Dots, Dash, Dash Dots, Long Dash, Long Dash Dot, Long Dash Dot Dot and Stippled.
- Line Width - Allows you to adjust the width of the lines. Moving the slider bar to the right increases the thickness of the line.
- Line Colour - Allows you to select the colour of the line. Clicking on the drop down arrow will display a colour swatch. Locate the desired colour and left-click it once to select it.
ADX Style: This option expands to show the properties of the ADX Style. The properties are identical to those listed for the ADXR Style.
DM + Style: This option expands to show the properties of the DM + Style. The properties are identical to those listed for the ADXR Style.
DM - Style: This option expands to show the properties of the DM - Style. The properties are identical to those listed for the ADXR Style.
Offset: This provides the option to offset the Average Directional Movement Index from the chart, to adjust the offset value use the blue up and down arrows.
Tool Transparency: Use this slider bar to adjust the transparency of the tool. Moving the slider to the left will increase the transparency of the tool.
Visible: Un-tick this checkbox to hide the tool from the chart.
Show In Price Scale: When selected the current values for the ADX, ADXR, DM+ and DM- will be displayed in the Price Scale.