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How to Use ADX to Identify Forex Trends
The Average Directional Index (ADX) rates how much a currency pair is trending on a scale from 0 – 100. A pair moving sideways shows an ADX level below 30 while a trending pair shows an ADX level of 30 or higher. Keep in mind that the ADX is directionally neutral, meaning it does not indicate a bearish or bullish trend, only if a trend exists or not. ‘How can I determine if a pair is trending or not?’ This is a common question we are asked at DailyFX EDU. A common tool used by many traders to answer that question is the Average Directional Index (ADX). Over the next few minutes, we’ll explain what the ADX is ... (full story)