What is the ADXR?

The ADXR is a different form of ADX. It allows us to calculate the same thing. Except it does it at a different rate. It allows us to slow down the ADX so we do not get skewed one way or another by a big move. To do this we take the current ADX level add the ADX level X number of days ago and divide it by two. This allows us to get an ADX indicator that is steady.

Below is an example of how the indicator looks on a chart.

Like the ADX the ADXR does not predict the direction a stock is likely to go but how strong the trend is. If this indicator is high that means the trend is strong. If it is low that means the trend is weak.

It is important to remember that a high level does not necessarily mean a strong stock. In this example the stock is trending down but the ADXR is high. This shows that the down trending is strong, so you should not be a buyer during this time.