The VHF Adaptive ADX Metatrader 5 forex indicator is a modified ADX indicator with some unique features.
Unlike the traditional ADX indicator, this version clearly displays the positive and negative ADX half-waves (depicted as a colored line within the indicator window).
How it works
A bullish trend occurs when the dual colored ADX line is positioned above its zero line.
Conversely, a bearish trend occurs when the dual colored ADX line is positioned below its zero line.
Furthermore, the DI+ or DI- signals are shown as their difference (displayed as the gray line).
The VHF ADX indicator is adaptive, as such it can react to market changes much faster and can also dish out buy and sell alerts faster than the original ADX indicator.
The color changes within the VHF Adaptive ADX indicator line can be used as a short term signal (good for scalping and day trading), while the zero crosses are a good candidate for longer term trend assessment.
Feel free to experiment with the indicator settings to suit your needs.
The EUR/GBP H1 chart below displays the VHF Adaptive ADX Metatrader 5 forex indicator in action.
Basic Trading Signals
Buy Signal: Go long when the ascending dual colored line of the VHF Adaptive ADX Metatrader 5 indicator crosses above the zero signal level from below. This is a bullish signal.
Sell Signal: Go short when the descending dual colored line of the VHF adaptive ADX Metatrader 5 indicator dips below the zero signal level. This is a bearish signal.
Exit buy trade: Close all buy orders if while a bullish trend is ongoing, the dual colored line of the indicator dips below the zero signal level.
Exit sell trade: Close all sell orders if while a bearish trend is ongoing, the dual colored line of the indicator surges above the zero signal level.
Tips: The method of using the VHF Adaptive ADX MT5 forex indicator is the same as the traditional ADX.
Applying the indicator to lower timeframes will suit short term traders (scalpers and day traders), while long term traders can adopt longer timeframes (swing traders and position traders).
MT5 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 5
Type: chart window indicator
Customization options: Variable (ADXm period, VHF adaptive ADXm?), Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: trend | oscillator
Copy and paste the VHF adaptive ADXm.ex5 indicator into the MQL5 indicators folder of the Metatrader 5 trading platform.
You can access this folder from the top menu as follows:
File > Open Data Folder > MQL5 > Indicators (paste here)