Vortex Indicator (VI) on Gold

What it shows

VI + in blue and VI - in pink run side by side below the candles. They are two separate ratios, not one oscillator, and the width of the gap between them says how clear the lead is.

How Pravex works it out

1. For each candle, up movement = the distance from this high to the previous low. Down movement = the distance from this low to the previous high. Both are taken as positive numbers.
2. Add up the up movement, the down movement and the true range over the last Length candles.
3. VI + = summed up movement ÷ summed true range.
4. VI - = summed down movement ÷ summed true range.
5. With invented sums: if up movement sums to 60, down movement to 40 and true range to 100, VI + is 0.6 and VI - is 0.4.

Settings

Setting	Default	What changing it does
Length	14	How many candles go into each sum. A shorter Length makes the lines cross more often. A longer one is slower and steadier. The lowest allowed value is 2.

How traders read it

Blue over pink is the up side in the lead; pink over blue, the down side. The moment they swap places is the Vortex signal itself.

A wide gap between the two lines says one side has been clearly stronger across the window. Two lines tangled close together say neither side has had the upper hand.

No guide levels are drawn. Both lines are ratios against true range, so they move together when volatility changes. Compare their order and gap, not their absolute height.

When it misleads

In a sideways range the two lines weave around each other and cross again and again, each cross late and without a trend to follow. A single large candle can flip the order for a while until it leaves the window. Calm gold hours make small candles and a tangled pair, and there are no weekend candles, so a gap after the weekend can show up as a big jump in one line.

Questions and answers

What do VI+ and VI- mean?

VI + is the summed upward movement divided by the summed true range. VI - is the summed downward movement divided by the same. The larger one is the side that has moved further.

Do Vortex crosses work on 15-minute gold?

They fire often there. At Length 14 the window is three and a half hours, so a calm stretch tangles the two lines and produces crosses with no move behind them. A longer Length, or the hourly chart, gives fewer of them.

Vortex Indicator vs Aroon Oscillator?

The Vortex compares the size of upward and downward movement against true range. The Aroon Oscillator counts how long ago the highest high and lowest low printed. Both give a view of which side leads.

Does the Vortex Indicator show how strong a trend is?

Only roughly. The gap between the lines hints at it, but the Vortex mainly tells you which side leads. A separate measure such as the Choppiness Index speaks to trend against range.

Related: Aroon Oscillator, Trend Strength Index, Choppiness Index, Average Directional Index, every indicator.