Directional Movement Index, or simply “DMI” is a trend following method, which, if combined with the market trend indicator, ADX (see elsewhere), can be used as an exact trading system. The DMI is used by some for trading, based on the directional indicator values: +DI and –DI explained below. Some do this by buying when +DI line crosses above the –DI line, selling when the –DI crosses below the +DI, both with exit or reverse trading when extreme points are hit.
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