A Trend Strength Indicator, how strong a trend is.

The indicator is based on a moving average of price range expansion over a given period of time.

Comprises three lines:

• Positive directional indicator +DI;
• Negative direction indicator -DI;
• The ADX itself.

A Buy signal (in an uptrend) is generated when +DI rises above -DI.

A Sell signal (in a downtrend) is generated when -DI rises above +DI.

Both signals are valid only if the ADX itself is rising, which indicates the presence of a trend.

And if the ADX is falling, it's time to think about profit-taking.