Vortex Indicator

Two lines that measure how far each bar reaches beyond the bar before it, up and down.

What it measures

VI+ adds up how far each bar’s high reached above the previous bar’s low; VI− adds up how far each low reached below the previous high. Both are divided by the true range over the same bars.

How traders read it

Traders read VI+ crossing above VI− as the start of an uptrend and the reverse as a downtrend. Values around 1.1 and 0.9, marked on the chart, are often used as the levels that confirm a cross.

Formula

VI+ = Σ |high − previous low| / Σ true range, over the last periods bars
VI− = Σ |low − previous high| / Σ true range
true range = the largest of high − low, |high − previous close|, |low − previous close|

Settings and output

Call: vtx(periods)

Setting	Chart default
`periods`: Periods	14

What you get: a list of 2, in this order: 1. a number (“vtx Negative”); 2. a number (“vtx Positive”).

Warm-up: with vtx(14), it asks for 2 bars of history and a run-up of 14, and its first value came on bar 16 of the example data.

Chart

Vortex Indicator drawn by its own code on example prices

The prices are made up, hourly, and the same on every page, so the chart shows how the indicator behaves, not how a market behaved.

In an algorithm

function onIntervalClose() {
  const lines = vtx(14);
  const minus = lines[0];
  const plus = lines[1];
  if (plus > minus && plus > 1.1) {
    log("VI+ above VI− and above 1.1");
  }
}

Note the order: VI− first, then VI+.