The ADX Buy Sell indicator for MT4 is based on the Average Directional Index and uses the crossover of the DI+ and DI- lines to identify potential bullish and bearish price movements.
The indicator displays blue and red arrows directly on the price chart.
A blue arrow signals a potential BUY opportunity, while a red arrow indicates a possible SELL setup.
One of its main advantages is that it does not repaint completed signals, making it useful for technical analysis and strategy testing.
The ADX Buy Sell Indicator can be used for both intraday and longer-term trading.
It is also particularly effective for scalping when combined with a separate trend filter such as the Trend Magic Indicator for MT4.
Download This MT4 Indicator for Free
Why traders use the ADX Buy Sell Indicator
The main attraction is the simplicity of its signals.
The blue and red arrows make it easy to identify potential changes in market direction without having to interpret the individual ADX components manually.
The non-repainting characteristic is particularly useful because completed arrows remain on the chart.
This allows previous setups to be reviewed and the trading method to be evaluated using historical price data.
For scalping, the signals can be filtered using the Trend Magic line.
A blue Trend Magic line represents bullish conditions, while a red line represents bearish conditions.
This creates a simple directional rule: focus on BUY arrows when the Trend Magic line is blue and SELL arrows when it is red.
Indicator Chart Setup
The ADX Buy Sell Indicator displays arrows around the price candles.
Blue arrows appear below the candles and indicate potential bullish signals, while red arrows appear above the candles and indicate potential bearish signals.
The signals are generated from the relationship between the DI+ and DI- components of the ADX calculation.
The indicator can be applied to any MT4 timeframe and is particularly suitable for short-term charts such as M1 and M5.
Core Features
- Based on the Average Directional Index.
- Uses DI+ and DI- crossovers to generate trading signals.
- Blue arrows identify potential BUY setups.
- Red arrows identify potential SELL setups.
- Does not repaint completed signals.
- Works across multiple MT4 timeframes.
Best for
- Forex scalping on M1 and M5 charts.
- Intraday trend-following setups.
- Short-term momentum trading.
- Confirming directional changes.
- Combining entry signals with a separate trend filter.
Best Markets
- EURUSD for M5 scalping and liquid intraday setups.
- GBPUSD during the London and New York sessions.
- USDJPY when directional momentum develops.
- GBPJPY for traders comfortable with larger intraday price movements.
- XAUUSD for short-term momentum strategies during active market periods.
Trading Styles
- Forex scalping on M1 and M5.
- Intraday trading on M15 and H1.
- Trend-following strategies.
- Momentum trading during active sessions.
- Multi-timeframe analysis.
How traders use it
A basic approach is to use the ADX arrow as the entry trigger while another tool determines the dominant market direction.
The Trend Magic Indicator works well for this purpose because its blue line indicates bullish conditions and its red line indicates bearish conditions.
When Trend Magic is blue, the focus remains on BUY signals from the ADX Buy Sell Indicator.
When Trend Magic is red, the focus switches to SELL signals. This helps prevent taking every arrow during periods when the market is moving sideways.
Scalping Strategy
For M1 and M5 scalping, combine the ADX Buy Sell Indicator with the Trend Magic Indicator.
Trend Magic determines the market direction, while the blue and red ADX arrows provide the short-term entry trigger.
Buy Rules – M5
- Trend Magic must be blue.
- Price should remain above the Trend Magic line.
- Wait for a blue ADX BUY arrow.
- For additional confirmation, wait for price to break above the high of the signal candle.
- Place the stop below the latest M5 swing low.
- Consider a 5-15 pip target depending on EURUSD volatility and the current session.
Example: EURUSD M5 Buy Setup
Suppose EURUSD is trading around 1.1740 and the Trend Magic line is blue.
Price pulls back toward the blue line but remains above it. A blue ADX arrow then appears below a candle with a high at 1.1744.
A scalper could wait for EURUSD to break above 1.1744 before entering the BUY trade.
If the recent M5 swing low is around 1.1736, the stop could be placed below this level. With approximately 8 pips of risk, a 1:2 risk-to-reward target would be around 1.1760.
Sell Rules – M5
- Trend Magic must be red.
- Price should remain below the Trend Magic line.
- Wait for a red ADX SELL arrow.
- For additional confirmation, wait for price to break below the low of the signal candle.
- Place the stop above the latest M5 swing high.
- Consider a 5-15 pip target depending on volatility and market conditions.
Example: EURUSD M5 Sell Setup
Suppose EURUSD is trading around 1.1765 and Trend Magic is red.
Price makes a temporary pullback toward the red line but fails to break above it.
A red ADX arrow then appears above a candle with a low at 1.1761.
A SELL entry could be considered when EURUSD breaks below 1.1761.
If the latest M5 swing high is near 1.1769, this provides a reference for the stop-loss.
A 1:2 risk-to-reward approach would then target approximately 1.1745.
Get Instant Free Access
Indicator Settings
- ADXcrossesPeriod: Determines the calculation period used by the ADX Buy Sell Indicator.
- Default Period: The standard setting is 14.
- Period Adjustment: Different values can be tested for individual currency pairs and timeframes.
Important Notes
- The strongest signals generally occur when the market has established a directional move.
- Sideways markets can produce repeated BUY and SELL signals.
- For M1 and M5 scalping, use Trend Magic to filter the direction of the ADX signals.
- A blue Trend Magic line means focus on BUY setups, while a red line means focus on SELL setups.
- Waiting for the signal candle high or low to break can provide additional entry confirmation.
- Adjust the ADX period carefully because changing it can affect the frequency of the signals.
