/*ADX/DMI Indicator

How to enter a trade?

ADX line must be above 25 this means that there is a wide direction movement tre
nd.
When DI + Crossed DI- bullish you have to enter in the same candle stick this me
ans TO BUY.
When DI- crosses DI`+ bearish you have to enter the trade in the same canble sti
ck this means TO SELL
ADX is a closed indicator and works between 0 and 100.But is not so probable to
see ADX above 60.
ADX under 20 shows a weak trend or flat market, and ADX above 40 means a strong
trend.
ADX Line doesn t show trends, but only the strength of actual trend.
TRIGGERS
Buy Trigger : +DI crosses up -DI
Sell Trigger : - DI crosses up +DI
ADX Under 25 says: DO NOT ENTER A TRADE
*/
_SECTION_BEGIN("ADX DMI Indicator");
SetChartBkColor(16);
range = Prefs( 49 );
_N( ranstr = "("+WriteVal( range, 1.0 )+")" );
Plot( ADX(range), "ADX" + ranstr, -9, 5 );
Plot( PDI(range), "+DI" + ranstr, -16 );
Plot( MDI(range), "-DI" + ranstr, -8 );
Plot( 25 , "", colorgreen,styledashed);
//--Indicator-End-- -- do NOT remove this line!
//
// DMI/ADX Commentary
// Copyright (C)2002 amibroker.com
Ad = Graph0;
pd = Graph1;
md = Graph2;
ep = IIf( pd > md,
ValueWhen( Cross( pd, md ), Low ),
ValueWhen( Cross( md, pd ), High ) );
good = IIf( pd > md,
High > ep,
Low < ep );
bs = IIf( pd > md,
BarsSince( Cross( pd, md ) ),
BarsSince( Cross( md, pd ) ) );
"Directional movement:";
"Plus directional movement index line (+DI) is currently "+
WriteIf( pd > md,"above", "below")+
" minus directional movement index (-DI)";
"It crossed "+
WriteIf( pd > md, "above", "below" )
+ " " +

WriteVal( bs, 1.0 ) + " bars ago.\n";

"Welles Wilder (the author of Directional Movement indicator) suggests buying wh
en the +DI rises above the -DI and selling when the +DI falls below the -DI.";
WriteIf( bs < 4,
"\nSince the crossover happened just recently, this may be a good opportunity to
enter " +
WriteIf( pd > md, "long" , "short" ) +
" trade (or close already open "+
WriteIf( pd > md, "short", "long")+
" trade (if any)\n",
"\nCrossover happened more than 3 bars ago, so it is too late to act on this sig
nal.\n")+
WriteIf( bs < 4,
"Wilder, however, suggest to qualify simple +DI/-DI crossover with 'extreme poin
t rule'. When the +DI rises above the -DI, the extreme price is the high price o
n the day the lines cross. When the +DI falls below the -DI, the extreme price i
s the low price on the day the lines cross. The extreme point is then used as a
trigger point at which you should implement the trade.\n","")+
WriteIf( bs < 4, "Current extreme point value is " +
WriteVal( ep ) + "." +
WriteIf( good, " Since today's " +
WriteIf( pd > md,
"high ("+WriteVal( High ) +") is higher",
"low ("+WriteVal(Low)+") is lower" ) +
" than extreme point so the rule is fulfilled and " +
WriteIf( pd > md, "buy","sell")+
" signal is confirmed.\n",
"Until now this rule is NOT fulfilled, so it is suggested to wait for the confir
mation.\n"),"");
falling = ROC( Ad, 2 ) < 0;
strength = IIf( Ad < 15 OR ( Ad < 25 AND falling ), 0,
IIf( Ad < 25 OR ( Ad < 35 AND falling ), 1,
2 ) );
"Trend strength:";
"The ADX is currently " + WriteVal( Ad ) + " and "
+WriteIf( falling, "falling.", "rising." );
"This suggests that the trend is "+
WriteIf( strength == 0,
"rather weak or very weak. Important: when trend is weak directional movement sy
stem generates signal too frequently and whipsaws can 'eat' all your profits.",
WriteIf( strength == 2,
"rather strong.",
"medium in its strength."));
"\nThis commentary is not a recommendation to buy or sell. Use at your own risk.
";
_SECTION_END();