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TRIX

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Introduction

The TRIX Indicator is a kind of triple smoothed average. It can eliminate a number of whipsaws with only marginal lag in the signal compared to faster indicators.

Construction

  1. Chose the periods n based on the time frame you are trading
  2. EMA1 = EMA (period.close)
  3. EMA2 = EMA (EMA1)
  4. EMA3 = EMA (EMA2)
  5. TRIX (period) = ( EMA3 (period) - EMA3 (period.previous) ) / EMA3 (period.yesterday)

Signals

  • Go long when TRIX turns up below zero, ie (TRIX < 0) && (DIFF(TRIX) > 0) -> Long
  • Go short when TRIX turns down above zero, ie (TRIX > 0) && (DIFF(TRIX) < 0) -> Short

Strength

Notes

  • Use a signal line EMA [9] (TRIX) to eliminate false signals
  • wait for TRIX to cross signal line before entering the trade
  • Go long on bullish divergence
  • Go short on bearish divergence
  • Default TRIX is n = 12 periods

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