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 28.07.2019

AAKASHAYA PATRA SEVEN STAR SMART EDUCATION SERIES PART – 18

DMI (Directional Movement Index)

DMI (Directional Movement Index) developed by J.Welles Wilder in 1978 it compose of two lines, one known as DI+ and Second line known as DI- DMI indicator is very easy to understand, without going in the formula of the indicator we are focusing how to understand this indicator and how we make a best use of this indicator while planning a new trade


1) As discussed above it compose of two lines DI+ and DI-
                  +DM is the Current High - Previous High.
                   -DM is the Previous Low - Current Low.

2) DI+ indicate buying pressure and price is going upward side and difference between previous high and current high is positive, while DI- Indicate selling pressure and price is going down ward side and the between previous low and current low is negative

3) When D+ line cross D- Line from below to above, it indicate that buying pressure is increase ing and price may go upward side in near future

4) Similarly When D- Line cross D+ line from below to above which indicate selling pressure is increasing as compare to buying and price may go down in near future

5) In this indicator, crossover is play an important role to guide us when to trade, it indicate end of current trend / swing and start of new trend / swing respectively

6) The distance between DI+ line and DI- Line is indicate strength of the current trend, if the distance is increasing and lines are getting wider it indicate strength of respective trend

7) If both the lines are very close to each other and overlapping each other which indicate low volatility and side ways movement of the market

I hope u all understand this on DMI will be helpful for you to identify the new developing trend and direction of the price to plan the trade and the crossover will play an important role for entry or exit.If u want to watch this with charts then joint our classes and we will make u master on this indicator.

FOR MORE SUCH TYPE OF EDUCATION JOINT OUR ONLINE SERIES AND BATCHES AND BE A PRO TRADER CONTACT ON 7028 421 786.

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