XAUUSD Trading ADX Technical Analysis

The ADX indicator is a momentum indicator created by J. Welles Wilder.

ADX indicator is used to measure the strength of xauusd trends on a scale of 0 - 100; the higher the ADX indicator value the stronger the current XAUUSD trend. It should be noted that while the direction of gold price is important to the ADX indicator calculation, the ADX indicator is not a directional indicator. ADX indicator values above 30 indicate a very strong xauusd trend, while ADX indicator values below 20 indicate no trend xauusd market - ranging market.

Traders typically use the ADX technical indicator as a filter combined with other indicators to create a gold trading strategy.

XAUUSD Trading technical analysis ADX indicator levels turning up from below 20 is an early signal of a new xauusd trend while declining levels turning down from ADX indicator levels above 30 as deterioration of the current xauusd trend.

ADX technical indicator should be used as part of a xauusd strategy that includes the +DI and -DI lines. Most xauusd platforms integrate the original ADX indicator with the +DI and -DI indicators (DMI Index Indicator) & collectively refer to the whole system as the ADX indicator.

In the gold trading example shown below:

ADX indicator is the light green-line

+DI is the blueline(bullish line)

- DI is the red line(bearish line)

Gold Trading ADX Indicator - ADX Strategy

• Bullish Trend - XAUUSD Trading ADX Technical Analysis- when the +DI, blueline is above the -DI, red-line
• Bearish Trend - XAUUSD Trading ADX Technical Analysis- when the -DI, red-line is above the +DI, blue-line

Bullish Trading Signal

A bullish xauusd trading signal gets generated when +DI line is above the -DI line, when the blue line is moving above the red line.

To identify a strong bullish xauusd signal xauusd trader should wait until the ADX XAUUSD Indicator values are above 20, and the blue line is above the red line. This is a bullish xauusd signal because the DMI Index system identifies the xauusd signal as a buy, while ADX XAUUSD Indicator levels above 20 shows there is a strong upward gold trend.

Bearish Trading Signal

A bearish xauusd signal is generated when the red line is above the blue line that is the -DI line is above the +DI line. A strong sell signal will be generated when this bearish xauusd signal is accompanied by an ADX XAUUSD Indicator value of above 20.

XAUUSD Trading ADX Buy & Sell XAUUSD Trade Signal Indicator - XAUUSD Trading ADX Technical Gold Indicator Explained