OPEN-SOURCE SCRIPT
Updated ADX-vALMA (N)
Its an advanced version of the Average Directional Index (ADX) designed to identify trend strength and direction with less lag and better smoothing.
Here is the breakdown of what it does:
1. Volume-Weighted ALMA (vALMA)
Instead of standard moving averages, this script uses ALMA (Arnaud Legoux Moving Average) weighted by volume.
The Benefit: It reduces the "lag" typically found in indicators while maintaining a very smooth line. The volume weighting ensures that price moves with high trading activity carry more weight.
2. Normalized ADX Mode (option)
You can toggle between two modes:
- Standard ADX: The classic calculation of trend strength.
- Normalized ADX: Rescales the ADX values to a 0–100 range based on a specific lookback period (default 50 bars). This helps identify trend surges relative to recent market behavior.
3. Visual Buy/Sell Signals
The script automatically plots shapes on your main price chart:
Green Triangle Up: Appears when the DI+ (bullish pressure) crosses above DI- (bearish pressure).
Red Triangle Down: Appears when the DI- crosses above DI+.
Note: There is a "Visual Offset" setting that allows you to shift these icons horizontally.
4. Dynamic ADX Coloring
The main ADX line changes color based on its slope:
Lime: Trend strength is currently increasing.
Red: Trend strength is fading or the market is entering a sideways phase.
5. Trend Filtering
It includes a Trend Threshold (defaulted at 22). When the ADX line is above this level, it indicates the market is in a strong trending state; below it, the market is considered "choppy" or range-bound.
Summary: It is a sophisticated trend-following tool that combines directional movement (DI+/DI-) with a high-tech filter (vALMA) to provide cleaner signals than the default ADX.
Here is the breakdown of what it does:
1. Volume-Weighted ALMA (vALMA)
Instead of standard moving averages, this script uses ALMA (Arnaud Legoux Moving Average) weighted by volume.
The Benefit: It reduces the "lag" typically found in indicators while maintaining a very smooth line. The volume weighting ensures that price moves with high trading activity carry more weight.
2. Normalized ADX Mode (option)
You can toggle between two modes:
- Standard ADX: The classic calculation of trend strength.
- Normalized ADX: Rescales the ADX values to a 0–100 range based on a specific lookback period (default 50 bars). This helps identify trend surges relative to recent market behavior.
3. Visual Buy/Sell Signals
The script automatically plots shapes on your main price chart:
Green Triangle Up: Appears when the DI+ (bullish pressure) crosses above DI- (bearish pressure).
Red Triangle Down: Appears when the DI- crosses above DI+.
Note: There is a "Visual Offset" setting that allows you to shift these icons horizontally.
4. Dynamic ADX Coloring
The main ADX line changes color based on its slope:
Lime: Trend strength is currently increasing.
Red: Trend strength is fading or the market is entering a sideways phase.
5. Trend Filtering
It includes a Trend Threshold (defaulted at 22). When the ADX line is above this level, it indicates the market is in a strong trending state; below it, the market is considered "choppy" or range-bound.
Summary: It is a sophisticated trend-following tool that combines directional movement (DI+/DI-) with a high-tech filter (vALMA) to provide cleaner signals than the default ADX.
Release Notes
Added D+, D-, and TR smoothing selection options:- Fast - smoothing based on the volume-weighted average ALMA (vALMA)
- Standard - smoothing as in the original Wilder indicator (RMA)
The ADX curve remains unchanged - it is still based on vALMA
Release Notes
Chart update - indicating differences between the quick and standard versionsOpen-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.