Description
The TRIX is a momentum indicator, that is displayed as an oscillator above and below a zero line. It compares two triple smoothed exponential moving averages, and displays the difference as a single line with positive and negative values. The TRIX is displayed on its own chart, separate from the price bars, and is the lower section in the example chart.
Calculation
- Description : The TRIX (T) is a comparison of the current and previous triple smoothed exponential moving averages.
- Calculation :
EMA1 = EMA1n-1 + ((2 / (n + 1)) * (Pn - EMA1n-1))
EMA2 = EMA2n-1 + ((2 / (n + 1)) * (EMA1n - EMA2n-1))
EMA3 = EMA3n-1 + ((2 / (n + 1)) * (EMA2n - EMA3n-1))
T = (EMA3n - EMA3n-1 ) / EMA3n-1
Trading Use
The TRIX is usually used as an oscillator, with long and short entries signaled by the TRIX crossing its zero line. It can also be used as a divergence indicator, with long entries signaled by bullish divergence, and short entries signaled by bearish divergence.
