Average Directional Index (ADX): Definition and Formula

Here is the article. 

What Is the Average Directional Index (ADX)?

The average directional index (ADX) is a technical analysis indicator used by some traders to determine the strength of a trend.

The trend can be either up or down, and this is shown by two accompanying indicators, the negative directional indicator (-DI) and the positive directional indicator (+DI). Therefore, the ADX commonly includes three separate lines. These are used to help assess whether a trade should be taken long or short, or if a trade should be taken at all.1

KEY TAKEAWAYS

• Designed by Welles Wilder for commodity daily charts, the ADX is now used in several markets by technical traders to judge the strength of a trend.
• The ADX makes use of a positive (+DI) and negative (-DI) directional indicator in addition to the trendline.
• The trend has strength when ADX is above 25; the trend is weak or the price is trendless when ADX is below 20, according to Wilder.
• Non-trending doesn't mean the price isn't moving. It may not be, but the price could also be making a trend change or is too volatile for a clear direction to be present.