Parts 3 and 4 of the “on chart” lessons for reading the ADX. They go pretty quick and there’s some icky clicking, but I made them before I figured out how to really reduce the clicking. Anyway, it’s the PRINCIPLES of the ADX that matter here, and how to combine various patterns of strength and weakness. The ADX is one indicator that is great at showing strength and weakness.

This first video for today also has a little bit on the DMI/DI lines, in addition to showing the ADX principles on real charts. I don’t pay the directional movement indicator/index lines much attention because they really don’t deserve it, but there is a little bit. You could spend years studying those two lines and trying to figure out one significance after another. I don’t, however recommend that course of study.

This second video on the ADX is more of the same, but goes into some other aspects of ADX reading that aren’t covered in other videos. Again, these are from real time charts…

That’s about the extent of the information on the ADX that I’ll be giving out here on the blog. There will be more on the inside, coming in August.

The principles of the ADX and the conditions are given in previous posts.

So if you have any comments or questions, please leave them below. And while you’re at it, sign up for the email stuff above (and to the right). You give me your name and email address, and I’ll give you free silver membership into the “Inner Sanctum” when it opens up in August.

And let me know what kind of stuff you want to see in the Inner Sactum. I’ll do what I can to make it happen. Have a truly phenomenal trading day!

Below is a video that shows a couple more ADX principles and shows how to look at them on a chart, including the theory behind the ADX. I’ll review a bit after the video…

So you see the difference between the strength and the weakness in trends? While the market moves farther in a direction, the ADX either moves higher than it was, or it doesn’t.

When the ADX moves higher as the market moves farther up or down, (after strength shown in that direction) then that’s strength.

When the ADX does not move higher as the market moves farther (after the ADX has already show strength in that direction), then that’s a weak move at the time.

XOW - ADX Outta Whack

Also shown on the video is the XOW, or “ADX Outta Whack“. The market moves with the ADX showing strength in a direction, then the market corrects a bit, then retraces part of the correction. As the market is retracing part of the correction, the ADX moves higher than it was before the correction (after a weak move registered in the opposite direction).

What the ADX is saying is completely out of what is visible in the market action and says basically that even though the market did not move farther in the direction of strength, the new motion in that direction is stronger than when the market was farther in that direction. For Forex Traders this XOW setup is a fantastic trading opportunity that doesn’t show itself very frequently.

It’s shown in the video so you can see it. AND, coming next week will be more ADX training videos, but with real charts instead of me hanging out at home with my white board.

So if you have any questions, please ask. Any comments? Leave ‘em. I’ll get to your question or comment pretty quickly. And if you want a LOT more useful info, I’ll have a secret area of this site available only to you if you leave your name and email address. Inside will be even more killer, more structured info and non-youtube videos, audios, and training ability. (There will definitely be a free section of the “Inner Sanctum” of DominationTrading.com - but that won’t be up until into August, 2008.

Let me know what you want more of so I can give it to you. Please, dear Forex Traders, let me know what you want to know and I’ll be more than happy to provide it if I can. Trade with greatness.

Here’s a video on the ADX principles and ideas, part 1:

There will be another ADX video covering some of what was not in this video. The next one will also cover weak trends, and the killer XOW and how to use it in your forex trading.

Don’t worry, there will also be a video or two (or more depending on your questions) of applying the ADX on real currency charts. You know the kind, the screen capture.

Quick review of the ADX video above: Covered strong moves (ADX increasing), weak moves (ADX decreasing) - there’s more to them, so watch the video above to get more. Trend basics were covered briefly, and I alluded to the “double-high” ADX, a special kind of strength that is AWESOME to trade with when you see it in the right place!

If you have any questions, or if I was unclear on anything, please let me know - and feel free to leave any comments you have, questions or whatever. I’ll definitely get to it as soon as I can.

And in August, I’ll be creating a special “members only” section of this site that will only be available to you if you enter your name and email in the form above and to the right. It’ll be free, with other options to be added later. So enter your name and email above so you can learn even more about how to trade your favorite forex currency pairs.

Take care and have a truly phenomenal trading day!