The Average Directional Index (ADX) measures how strong a trend is, not which way it points. It runs from 0 to 100: low readings mean a weak or absent trend, high readings mean a strong one. This makes it the perfect companion to your directional tools.
Reading the levels
A common convention treats readings below 20 as ranging and readings above 25 as trending. A rising ADX says the current trend — up or down — is gaining strength; a falling ADX says it is weakening, regardless of which direction price is going.
Used well, ADX acts as a gatekeeper: it tells you when your crossover, MACD or Supertrend signals are worth taking. When ADX is low, those trend tools whipsaw, so many traders simply stand aside until strength returns rather than fighting a flat market.
- ADX measures strength only — direction comes from other tools.
- Below ~20: weak or ranging; trend strategies struggle.
- Above ~25: trending; trend-following signals are more reliable.
- A rising ADX confirms strength; a falling one warns of a stall.
ADX gauges trend strength, not direction — use it as a filter to know when your directional signals are actually worth trading.