ADX stands for Average Directional Movement Index, which measures a trend's overall strength. A price range value is averaged to produce the ADX indicator. As part of Welles Wilder's Directional Movement System, the ADX is a component. In conjunction with the ADX, the DMI+ and DMI- indicators are used to measure the strength of price movements in positive and negative directions.

The Average Directional Index (ADX) is a technical indicator used in financial markets, particularly in trading. Developed by J. Welles Wilder, it quantifies the strength of a trend, not its direction. The ADX ranges from 0 to 100, with readings above 25 indicating a strong trend, and below 20 suggesting a weak trend or sideways movement. Traders often use ADX alongside other indicators to make informed decisions about entering or exiting positions. A rising ADX value suggests a strengthening trend, while a falling value may indicate a weakening trend or potential reversal. It's a valuable tool for trend analysis in various markets.