Directional Movement Index - DMI

DEFINITION of 'Directional Movement Index - DMI'

An indicator developed by J. Welles Wilder for identifying when a definable trend is present in an instrument. That is, the DMI tells whether an instrument is trending or not.

BREAKING DOWN 'Directional Movement Index - DMI'

The scale for the DMI is from 0 to 100. The average directional movement index (ADX) is a moving average of the DMI.

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RELATED FAQS
  1. What are common trading strategies when using the Directional Movement Index (DMI)?

    The directional movement index, or DMI, is a useful momentum indicator for assessing price direction and trend strength. ... Read Full Answer >>
  2. Why is the Directional Movement Index (DMI) important for traders and analysts?

    J. Welles Wilder Jr. created the directional movement index (DMI) to identify whether or not a security is trending. DMI ... Read Full Answer >>
  3. How do I use the Directional Movement Index (DMI) for forex trading?

    The directional movement index, or DMI, is a momentum indicator use to determine the existence of a trend and trend strength, ... Read Full Answer >>
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    One of the primary goals of technical market analytics is to identify performance trends in individual securities or indexes. ... Read Full Answer >>
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    Fibonacci retracement is a very popular tool among technical traders and is based on the key numbers identified by mathematician ... Read Full Answer >>
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