CCU Adx & DI Course
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Adx & DI Course – Overview
1.
What is the Adx & DI
2.
How to find this indicator and set it up
3.
Cheat Sheet
4.
How to use this indicator to dominate
5.
Conclusion
6.
Test
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Adx
& DI
1.
What is ADX & DI?
Introduction to ADX and DI
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There are 3 lines: a DI+, DI- and ADX
DI+ is green and when it crosses up, price should go up
DI- is red and when it crosses up, price should go down
ADX is the yellow line and tells us trend strength
The DI tells us when to buy and sell – the ADX tells us the trend strength
Together these 3 indicators tell us the direction of price AND how strong the new trend is. This gives us a
competitive advantage.
The ADX is a mathematical equation between the difference between the DI+ and DI-
* See on the below chart the 3 lines, their colors, and their names:
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The default setting is 14 bars. (Default settings shown in above pic in upper left)
ADX and DI can be also be used on any other trading vehicle such as stocks, mutual funds, exchangetraded funds and futures ect
ADX values range from a low of zero to a high of 100.
You will see these 3 indicators plotted together as shown above
When the GREEN (DI+) is above the RED (DI-) prices should be moving up. We simply need to look at the
yellow (ADX) to see how strong the trend is
We also look at how wide the mouth is open (Just like Bollinger bands) to understand the strength
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Adx
& DI
2.
How to find the Indicator & set up?
1. This indicator is on Coinigy – search “DMI” Please note: You will need to adjust the settings and colors
yourself.
2. Open TradingView
3. Click indicators
4. Select Public Library
5. Type in ADX and DI and click the one that is by BelkabuOyaji with 34K plus likes (top line)
To change settings: Click above arrow, as shown below:
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Adx
& DI
The below are the settings for the 12hr, 1 day and weekly charts:
The colors below are for ALL settings (daily, weekly and monthly);
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Adx
& DI
3.
ADX & DI Signal Cheat Sheet:
ADX & DI Main purpose: (Buys & Sells for both bull and bear markets)
• 12 Hour Chart Settings: 14,20
• Daily Chart Settings: 14, 20
• Weekly Chart Settings: 14, 20
1. 12 Hour Chart: Signals approximately once every 1-2 weeks you could have either a buy or a sell signal
(Slightly Accurate) Swing Trader
2. Daily Chart Signals: Signals approximately once every 3-4 weeks you could have either a buy or a sell
signal (Pretty Accurate) Hybrid Trader
3. Weekly Chart Signals: Signals approximately once every 6 months you could have either a buy or a
sell signal (Very Accurate) Hybrid Trader/ Long Term Investor
4.
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How to use this indicator to dominate
When green (DI+) crosses up – it’s a buy signal
When red (DI-) crosses up – it’s a sell signal
Use the yellow (ADX) to understand trends, the bigger picture and gain confirmation. You do not have to
use the ADX to make buy and sell decisions but instead use it as a tool to understand the strength of the
buy or sell before and during the trade.
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Adx
& DI
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Notice on the below chart how the green (DI+) crossed up – this was our buy signal and price followed in
a large way.
Also notice how the yellow (ADX) was low when the cross happened. It then gained momentum. This
is classic, as there was consolidation prior to green crossing up (quiet market and weak trend) then
the market had a large move and the yellow line (ADX) kept gaining strength. Remember, the yellow
indicates the strength of the trend. Notice at the top of the price action, the yellow started going down.
What does that tell us? The trend is losing strength – not necessarily that price is going down.
In the below chart: Notice how the green (DI+) crossed up. Not just an ordinary cross up, the mouth was
open wide. This told us from the beginning that it was going to be a larger move to the upside. Price ended
up more than doubling. Make sure to watch how wide the mouth is open or how narrow the mouth is open,
telling us the move will not be powerful. Should this alter your trading? No, this is something to use to
better understand market moves and to plan accordingly.
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Adx
& DI
Now notice the below chart. The arrow on the bottom right indicates a cross up in red (DI-). However, there
was a small mouth opening. This told us the move would be small. Price ended up going down, but only
slightly and more so, consolidated for a period of time.
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Adx
& DI
Quantifying Trend Strength
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When the ADX (yellow line) is below 25 – the trend is considered weak
When the ADX is above 25 – the trend is considered strong – further strength levels below
ADX Value Trend Strength
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0-25
Absent or Weak Trend
25-50
Strong Trend
50-75
Very Strong Trend
75-100
Extremely Strong Trend
Low ADX is usually a sign of consolidation or accumulation. SEE BELOW
From low ADX conditions, price will eventually break out into a trend.
A common misperception is that a falling ADX line means the trend is reversing. A falling ADX
line only means that the trend strength is weakening, but it usually does not mean the trend is
reversing.
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Adx
& DI
Trend Momentum
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A series of higher ADX peaks means trend momentum is increasing.
A series of lower ADX peaks means trend momentum is decreasing.
ADX can also show momentum divergence. SEE BELOW
When price makes a higher high and ADX makes a lower high, there is negative divergence, or
non-confirmation.
In general, divergence is not a signal for a reversal, but rather a warning that trend momentum
is changing.
*In the above chart – notice the yellow line (ADX) and the clear divergence forming. Meaning price
action continued to make higher highs, as illustrated by the arrows and the ADX continued to make
lower highs, as you look at the green arrows pointing down. In this case, we were warned that this
trend was in trouble.
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Adx
& DI
This is a good indicator to start to better
understand trading. Swing Traders can use this as
well as Hybrid Traders and long-term investors. The
indicator has many benefits with understanding
trend strength as well as direction of the price.
So, if these signals are late, what is the better
option to not leave tons of money on the table?
That’s exactly why I created my custom designed
Hybrid Strategy, which when back tested for the
last 10 years is SIGNIFICANTLY more accurate
than this indicator. Which is why my courses have
changed lives all over the world.
The LARGE downfall remains in the signal itself. It
often comes very late. Meaning on a daily chart
the buy signal comes several days late and the sell
signal comes several days late, which can cause you
to leave LOTS of money on the table. On the weekly
chart, the buy signal comes several WEEKS late and
the sell signal several weeks late, which will cause
you to leave TONS of money on the table.
Now you have gained significant knowledge in this
course and on top of that, you love my style of
teaching because for the first time, you FINALLY
understand the charts. You fully understand this
indicator and have made lots of progress with this
course. Now let’s get you set up with the courses
that will REALLY change your life so you’re NOT
leaving tons of money on the table.
5.
Conclusion
If you’ve been in Crypto for 1-3 years, CLICK HERE
to get signed up now:
If you’re new to Crypto and want to start right at
step 1, CLICK HERE to get signed up now:
https://cryptocrewuniversity.com/classes/gold-combo
https://cryptocrewuniversity.com/classes/diamond-combo
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Adx
& DI
Quiz
1. What is the difference between the ADX and DI?
2. Which DI is green and which is red?
3. What is the yellow line called and what is it used for?
4. When trading – should I wait for the ADX to signal before buying or selling?
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Notes
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