Know we Blokhin that the ADX in the carrot and this is a very good indicator. It’s not a very good indicator that you can use as a beginner trading for it’s going to use the A D x indicator. So it’s average directional movement indicator. You can find it in trends go to trends you can find average directional movement indicator.
This is a very good indicator to use because it gives you buy and sell signals. And it also tells you whether the market is Consoli data in our trending. Now if the market is consolidating this line here which is the ADX line will be entangled with other lines just like this here when the market is trending in the ADX line this line here will be above all the other lines. So that’s SOAD ADX can be used to tell you whether the market is trending.
Are consolidating now to use the ADX for buy and sell signals. No this is how you use the ADX whenever the red ADX line this is the minus line crosses the plus line which this black line here is the last line whenever of minus nine the red line Cross says the last line whenever the red line goes above the black line. In this example once it exceeds the blackline. Just wait until the red line exceeds a black line. As long as it goes a little distance above the black line that’s a cell signal. And the same thing goes for when the black line crosses the red line.
Both lines have to exceed each other before the signal is confirmed. So let’s look at. Oh you can’t trade. Use an ADX. You could sell the market once the lines exceed each other so you could sell the market here at this particular point here. You could have sold the market. That would be right around here if you sold the market there you would have made that see you would have made a hundred and forty pips used in the ADX in the car.
And remember you can combine these indicators with stuff like trend lines and candlestick patterns and other indicators to form a nice Forex trading strategy. Now let’s look at another trade with the ADX indicator. Remember when the lines exceed each other that’s when the trade is confirmed. For example look at this one. The lines exceed the chart right on this level.
This is when both lines exceed each other and this is a cell signal because the red line is a ball of the blackline. The minus line is above the plus line that say cell signal. So it is a cell signal and you could have sold the market here over one Anjanette £50 profit. So ADX is a very good indication. It’s an example where the blackline crosses the red line.
Let’s look at that. So you would have wait until the blackline exceeded the red line which is right around here. This is when you would buy the market using the ADX. So you would have answered right through on this level. Profit over owned jet and for that Pip’s profit so the ADX in the carrier is a very good indicator that you can use as a beginner trade for it. And you can go back and back test using the ADX indicator.
Remember once the black line exceeds the red line that’s when the trade is confirmed. So you would not have entered here you would have entered right around this level. This is when the blackline exceeded the red line. And if you had entered here that’s the if you were in third there that means you would have answered the market right sir on this level.
And that’s a hundred and sixty pips. So the ADX is a very good indicator. And remember you can combine the ADX with other indicators such as the stock crest the moving average the Chimo coup and you can combine everything along with your knowledge of Calvinistic Pazza and support and resistance and make one big trading strategy. And I can show you tons of examples of trades that you could have taken using the ADX indicator member whenever the ADX line is entangled with the other line.
That’s when the market is consolidating meaning that’s when the market is going sideways. Whenever the blue line ADX line is above all the other nines that’s when the market is strong that’s when the market is trending. Isn’t that a trade that you could have taken using ADX indicator. Remember you wait until the lines exceed each other.
That’s when you would sell. So you would sell the market here when the red line the minus line exceeds the blackline case. That’s when you would sell. And let’s see which profits you could have made if you had entered the market there could have made over Onge at Pip’s profit. No nothing is 100 percent. So there might be times when you enter too early use an ADX which might result in a loss and that’s because nothing is 100 percent. So here’s an example of that.
Here we have the blackline crossing the red line. And you might have entered right around this level year. And if you had answered here the market would have gone against you 50 pips the market would have fell 50 pips before actually rising hanja pips in your direction. So you might have entered too early. And as a result you might be stopped out on the street.
If you’re a stop loss order wasn’t below the lowest you might have gotten stopped on this trade because you entered too early. So nothing is 100 percent. Which is why it’s good to combine these indicators with other indicators and what other strategies such as trendlines candlestick support and resistance etc. and form one big plan one big strategy of trade in the market over for a stop loss order was below the market.
You would have made a hundred and four pay off this trade because the market eventually rallied. No one of the reasons why this is a good example is because remember whenever the ADX line is in tangled with all the other lines that’s when the market is consolidating. And in this example you can see that the ADX line is entangled with all the other lines. So this is not really the best ADX signal. So that’s oh you can’t trade Forex using the ADX indicator.