Average Directional M. I. Wilder

Average Directional Movement Index Wilder (ADX Wilder)

The Average Directional Movement Index Wilder (ADX Wilder) is a technical indicator that helps determine if there is a price trend. It is based on the algorithm described by Welles Wilder in his book ‘New Concepts in Technical Trading Systems’.

Trading Rules

The trading rules for this indicator can be found in the section ‘Average Directional Movement Index’.

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ADX Wilder+DI-DI EURUSD · H1

ADX Wilder with +DI and -DI. Wilder's smoothing makes the lines calmer than those of the standard ADX.

Calculation of ADX Wilder

ADX Wilder uses the same +DM, -DM and True Range values as the standard ADX, but smooths them with Wilder’s smoothing method (a smoothed moving average) instead of an exponential moving average:

+DI = SMMA(+DM, N) / SMMA(TR, N) * 100
-DI = SMMA(-DM, N) / SMMA(TR, N) * 100
DX = ABS(+DI - -DI) / (+DI + -DI) * 100
ADX = SMMA(DX, N)

Where:

• SMMA is a smoothed moving average (Wilder’s smoothing);
• N is the indicator period (14 by default).

Because of the different smoothing, ADX Wilder values differ slightly from those of the standard ADX with the same period.