Reference appendix
Trend & direction
Tools for reading which way a trend points, how strong it is, and where it may reverse.
How these fit together
This page divides into three jobs. ADX, ADXR and the DI lines measure trend strength and direction, and ADX in particular acts as the gatekeeper for nearly everything else here — high readings favour the trend tools here, low readings favour the oscillators on the momentum page. Parabolic SAR and Supertrend are trailing mechanisms that assume a trend already exists and tell you when it has ended. Ichimoku, the Alligator and the regression family describe the trend's shape: where it is, how orderly it is, and how steeply it is running.
- ADX = how strong · DI lines = which way · Aroon = how recently
- ADX above 25 → trend tools work; below 20 → switch to oscillators
- SAR and Supertrend do the same job; Supertrend uses ATR and flips less often
- Ichimoku bundles trend, momentum and support into one system with three numbers
- TSF, regression curve and slope are the same fit reported three ways: projection, line, steepness
- Zig Zag is the drawing aid that makes the chart-shape patterns countable
Parabolic SAR
SARstudiedPlots dots that trail below price in an uptrend and above it in a downtrend, accelerating toward price over time. A flip in dot position signals a possible reversal — SAR stands for “stop and reverse,” and traders often use it to trail stop-losses.
Supertrend
SupertrenduntestedAn ATR-based line that sits above or below price and flips sides when the trend reverses, giving a simple read on trend direction plus a trailing-stop level.
Ichimoku cloud
ICHstudiedA multi-part system (Tenkan-sen, Kijun-sen, a shaded Senkou “cloud,” and the Chikou lagging line) showing trend, momentum, and support/resistance in one view — price above the cloud reads bullish, below reads bearish.
Williams Alligator
AlligatoruntestedThree smoothed moving averages of different lengths and offsets, nicknamed the jaw, teeth, and lips. Tangled together, the market is ranging; fanned apart, a trend is emerging.
Average directional movement index
ADXstudiedA 0–100 line measuring how strong a trend is, regardless of direction. Readings above roughly 25 are generally read as trending, below as choppy or range-bound.
Average directional movement index rating
ADXRstudiedA smoothed version of ADX — the average of the current ADX and the ADX from several periods earlier — used to confirm whether trend strength is holding up.
Directional movement index
DXstudiedThe underlying calculation, comparing +DI and −DI (the positive and negative directional indicators), that ADX is itself a smoothed average of. Shows raw directional strength.
Aroon indicator
AroonuntestedTwo lines, Aroon Up and Aroon Down, measuring how many periods have passed since the most recent high and low. Used to spot new trends forming and gauge how mature they are.
Aroon oscillator
Aroon OscuntestedThe difference between Aroon Up and Aroon Down as a single line, simplifying the Aroon Indicator into one trend-direction signal.
Mass index
Mass IndexuntestedTracks the widening and narrowing of the high-low trading range to flag potential reversals — a “reversal bulge” appears when the range expands sharply, then contracts.
Schaff trend cycle
STCuntestedBlends MACD with a stochastic-style calculation to identify trend cycles faster than MACD alone, aiming to cut lag when catching turns.
Zig zag
Zig ZagdefinedFilters out price moves smaller than a set threshold and connects only the significant swing highs and lows, making the larger trend structure easier to see. It redraws as new data arrives, so it isn't a real-time signal.
Triple exponential average
TRIXuntestedThe percentage rate of change of a triple-smoothed EMA. With that much smoothing baked in, it filters minor noise and highlights the dominant trend momentum.
Time series forecast
TSFdefinedPlots the endpoint of a linear regression line calculated over a moving window — essentially projecting where price “should” be if the recent trend continued.
Linear regression channel
Lin. Reg. ChanneldefinedA straight best-fit trend line through recent prices, with parallel lines offset above and below it (typically by standard deviation) forming a channel around the trend.
Linear regression curve
Lin. Reg. CurvedefinedThe linear regression line recalculated and plotted at every bar, tracking how the “best fit” trend shifts over time.
Linear regression slope
Lin. Reg. SlopedefinedThe steepness of the regression line at each point, shown as a single value — a rising slope means an accelerating uptrend, a falling one an accelerating downtrend.
How to read the evidence tag
Every entry here carries one of three tags. The tag rates the evidence behind the claim the entry makes — not how popular the tool is, how old it is, or how confident the people teaching it sound. Close to half of the entries on this site sit on the weakest tier — including every one of the eighteen Smart Money Concepts, which are drawn here in the same ink as Wilder’s ADX and deserve to be told apart from it. That is the honest position rather than an oversight.
- defined33 entries
True by arithmetic. This entry describes a calculation or a piece of terminology, and makes no claim about what price will do next. Nothing here can be wrong except a typo.
- studied56 entries
The predictive claim attached to this entry has been tested in peer-reviewed research. Being on this tier does not mean it works — across the literature these edges are typically small, unstable between markets and periods, and often gone after costs.
- untested87 entries
Widely taught and widely believed, but no published test of the claim was located while building this page. Treat it as a description of what traders do, not as evidence that doing it pays.
The line between studied and untested is drawn by whether a peer-reviewed test of the specific claim could be found, and those tests are listed on the Sources page under “Evidence and base rates”. If you know of a published test of something tagged untested, the tag is wrong and should change — that is the point of labelling it at all.