ADX trend smoothed Indicator For MT5
Table Of Contents:
- ADX trend smoothed Indicator For MT5
- Trading ideas with the ADX trend smoothed Indicator For MT5
- ADX trend smoothed Indicator For MT5 - Buy Entries
- ADX trend smoothed Indicator For MT5 - Sell Entries
- ADX trend smoothed Indicator For MT5 - Conclusion
The ADX trend smoothed Indicator For MT5 is based on the famous ADX indicator with a smoothing algorithm. The indicator shows you the direction of the trend as well as the strong of the trend. In addition you can also spot divergences at the end of a trend to trade reversals. Upward trends are drawn with two green colors while downward trends are drawn with two red colors.
The ADX trend smoothed Indicator For MT5 is one of the most advanced versions of the regular ADX indicator. Jurik Smoothing algorithm is used to process the sample data so that the readings from this indicator carry less noise. Since the indicator deploys complex smoothing formula to the sampled data, it is often called the standalone indicator.
The users of the regular ADX indicator often complained that the readings are tough to understand. But with the ADX trend - smoothed – indicator you will never face such a problem. You can easily analyze the different phases of the trend and take some quick decisions within a short time. The best thing about this indicator is the graphical representation of the data.
The data are shown in the form of a simple colored area chart with a baseline 0. Even the entry-level traders can take the reading from this indicator and filter the odd setups from the market. But will use this indicator to filter to perfect trades. For that, we need to have a perfect trading method that has a proven track record for securing 60% profitable trades. If the profit factor for the trading method is less than 60%, you need to change the system before you use the ADX trend - smoothed – indicator.
Trading ideas with the ADX trend smoothed Indicator For MT5
The trading strategy plays an important role in your success. Some of you may feel the complex trading method is the best way to earn money. But in reality, a complex trading method is hard to understand and the traders usually lose money while analyzing the complex metrics. Even though the ADX trend smoothed Indicator is a very simple and powerful tool but syncing this indicator to a complex system lowers its performance.
The investors fail to take the reading from the colored area chart and eventually lose the trades. In general, the bullish momentum is shown by the green-colored bars and the bearish momentum is shown by the red bars. At times you will notice the green and the red bars are painted with dark red bars which are nothing but the representation of market retracement.
But don’t get confused with the dark-colored bars created by the chart. We will illustrate the perfect process to take the trades at the most important levels without increasing the complexity. Let’s dive into the details and see how the elite traders take advantage of the ADX trend smoothed Indicator.
ADX trend smoothed Indicator For MT5 - Buy Entries
Most of the time, people take long trade at support. But we will show you a different method to use the ADX trend smoothed Indicator. Find a bearish trend or a key resistance level. Since no support or resistance level holds the price forever, we need to know how to trade the breakouts. Once the price test the resistance level, wait for the price to break above the resistance line.
If the price breaks above the resistance line, the color of the bars in the ADX trend smoothed Indicator will turn green. Green bars in the indicator tell us the bulls are pushing the price to a new high and the bullish break is valid. To take the long trades at the support level, look for the price action pattern indicating a bullish rally. During that time, the bars in the ADX trend smoothed Indicator will also remain red. But if the bars are marked with black colors, you should not take the long trade no matter how convincing the trade setup is.
ADX trend smoothed Indicator For MT5 - Sell Entries
Now you know how the green bars from the ADX trend smoothed Indicator helps us to execute the long trade. Smart traders might have guessed that red bars are the key requirement to take the short trade. But we have to find the short trade setups based on our trading method. Analyze the important market data and look for the short trade setups at the resistance level.
People who can find the weak support level can find the short trade setups at the break of the support zone. With your existing edge, find the bearish trade setups. Determination of the short trade is the indication to take the reading from the ADX trend smoothed Indicator. The color of the bars must be read when the selling signal is valid. Analyze the potential risk factor and evaluate the RR ratio.
Try not to risk more than 2% of your account balance because if you do so, it will be a great threat to your trading career. Lower down the risk and stick to the core rules of investment as it is the only way to trade safely.
ADX trend smoothed Indicator For MT5 - Conclusion
Some of the retail traders often forget that they have to lose money at trading. By mastering the use of the ADX trend smoothed Indicator they become overly confident and this usually pushes them to take the wrong decision at trading. To improve your trade execution process, you must learn to trade strategically.
Never try to put yourself in the line fire just because you have the power to identify the trend strength. Think about the news factor. It can change the trend within a blink of an eye and you will notice the big red bars have changed to big green bars on sudden bullish reversal. So, analyze the news data or try not to take the trades on such events. But ignoring the fundamental factors in the market is more like pushing yourself to the corner. You need to master technical, fundamental, and sentiment analysis skills as it will help you to make the best decision at trading.
Regarding the ADX trend smoothed Indicator, it should be taken as a filter that has the potential to eliminate the false reading from your trading edge. Get used to this indicator in the demo platform before you start depending on the real market. The demo platform will give you the perfect edge to improve your skills and allow you to learn the perfect use of the ADX trend smoothed Indicator.