# How To Calculate Average Directional Index (ADX) using MATLAB?

, in category: Other , 5 months ago

How To Calculate Average Directional Index (ADX) using MATLAB?

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by sincere , 5 months ago

﻿@santina.kub ﻿

To calculate the Average Directional Index (ADX) in MATLAB, you can use the following steps:

1. Import your price data into MATLAB as a vector or matrix.
2. Calculate the True Range (TR) values by finding the maximum of: High - Low Abs(High - previous close) Abs(Low - previous close)
3. Calculate the Directional Movement (DM) values by finding the positive and negative directional movements: Positive DM = High - previous high Negative DM = previous low - Low
4. Calculate the Directional Index (DI) values by dividing the sum of positive and negative DM values by the True Range values.
5. Calculate the Directional Movement Index (DX) values by finding the absolute difference between the positive and negative DI values divided by the sum of positive and negative DI values.
6. Calculate the ADX values by taking the exponential moving average of the DX values over a specified period.

Here is a sample code snippet to calculate the ADX in MATLAB:

 ``` 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 ``` ```% Import price data priceData = [100, 105, 110, 115, 120, 115, 110, 105]; % Calculate True Range (TR) high = priceData(:, 1); low = priceData(:, 2); close = priceData(:, 3); tr = max(high-low, abs(high - [close(1); close(1:end-1)]), abs(low - [close(1); close(1:end-1)]); % Calculate Directional Movement (DM) positiveDM = high - [high(1); high(1:end-1)]; negativeDM = [low(1); low(1:end-1)] - low; % Calculate Directional Index (DI) positiveDI = 100 * movmean(positiveDM./tr, 14); negativeDI = 100 * movmean(negativeDM./tr, 14); % Calculate Directional Movement Index (DX) DX = 100 * abs(positiveDI - negativeDI) ./ (positiveDI + negativeDI); % Calculate ADX ADX = movmean(DX, 14); disp(ADX(end)); % Display the ADX value for the most recent period ```

You can adjust the period length for moving averages and other parameters according to your requirements.

, 3 months ago

﻿@santina.kub ﻿

The provided MATLAB code calculates the Average Directional Index (ADX) for a given price data vector. This code snippet follows the steps mentioned earlier in the response. The following is a breakdown of each section in the code snippet:

1. Import price data: The priceData vector represents the closing prices of a financial instrument over a given period.
 ```1 ``` ```priceData = [100, 105, 110, 115, 120, 115, 110, 105]; ```

1. Calculate True Range (TR): The TR is calculated using the high, low, and close prices.
 ```1 ``` ```tr = max(high-low, abs(high - [close(1); close(1:end-1)]), abs(low - [close(1); close(1:end-1)]); ```

1. Calculate Directional Movements (DM): Calculate the positive and negative DM values.
 ```1 2 ``` ```positiveDM = high - [high(1); high(1:end-1)]; negativeDM = [low(1); low(1:end-1)] - low; ```

1. Calculate Directional Index (DI): Calculate the positive and negative DI values.
 ```1 2 ``` ```positiveDI = 100 * movmean(positiveDM./tr, 14); negativeDI = 100 * movmean(negativeDM./tr, 14); ```

1. Calculate Directional Movement Index (DX): Compute the DX values.
 ```1 ``` ```DX = 100 * abs(positiveDI - negativeDI) ./ (positiveDI + negativeDI); ```

1. Calculate ADX: Calculate the ADX by taking the moving average of DX values.
 ```1 ``` ```ADX = movmean(DX, 14); ```

1. Display the latest ADX value:
 ```1 ``` ```disp(ADX(end)); ```

You can adjust the period length (14 in the code) for the moving averages and customize parameters as necessary for your specific analysis.
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