TRIX

13 min read

Display Type: Oscillator | Complexity: Intermediate | Best For: Trend Analysis, Momentum Assessment, Divergence Detection, Noise Reduction

TRIX (Triple Exponential Average) is a momentum oscillator that measures the percentage rate of change of a triple exponentially smoothed moving average, designed to filter out market noise while identifying significant trend changes and momentum shifts. Developed by Jack Hutson in the 1980s, TRIX applies three layers of exponential smoothing to price data, creating an oscillator that is remarkably smooth and less prone to false signals compared to traditional momentum indicators. The indicator oscillates around a zero centerline, with positive values indicating bullish momentum and negative values suggesting bearish momentum. By eliminating short-term price fluctuations through its triple smoothing process, TRIX excels at identifying the underlying trend direction and momentum changes, making it particularly valuable for swing traders and position traders who need clear, reliable signals without the noise that often plagues faster oscillators.

What is TRIX? #

TRIX is a zero-centered momentum oscillator that calculates the percentage rate of change of a triple exponentially smoothed moving average. The indicator takes closing prices through three successive exponential moving average calculations, then measures the percentage change between consecutive values of this triple-smoothed average. This extensive smoothing process eliminates most short-term market noise while preserving the underlying momentum characteristics of price movement.

The oscillator’s primary function is to identify when momentum is building or declining in either direction, providing traders with early warnings of potential trend changes. Unlike many oscillators that can generate numerous false signals during sideways markets, TRIX’s triple smoothing creates a more reliable indicator that responds primarily to significant momentum shifts. This makes it particularly effective for identifying major trend reversals and confirming trend continuation patterns, while its zero-line crossovers provide clear directional bias signals.

Key Uses: #

Trend Direction Analysis: Zero-line crossovers indicate bullish/bearish bias
Momentum Assessment: Rate of change measurement shows momentum strength
Divergence Detection: Identifies momentum/price disconnects for reversals
Signal Line Crossovers: Entry/exit timing through TRIX vs signal line
Noise Reduction: Triple smoothing filters out false signals
Trend Confirmation: Validates signals from other indicators
Long-term Analysis: Suitable for higher timeframe trend assessment

How TRIX Works #

Triple Smoothing Process: #

Step 1: First Exponential Moving Average EMA1 = EMA(Close, Period)

Apply exponential moving average to closing prices
Standard period typically 14 periods
Creates first level of smoothing

Step 2: Second Exponential Moving Average EMA2 = EMA(EMA1, Period)

Apply exponential moving average to EMA1 values
Uses same period as first smoothing
Further reduces short-term noise

Step 3: Third Exponential Moving Average EMA3 = EMA(EMA2, Period)

Apply exponential moving average to EMA2 values
Completes triple smoothing process
Creates highly smoothed trend line

Step 4: TRIX Calculation TRIX = (EMA3 – EMA3[Previous]) / EMA3[Previous] × 10000

Calculate percentage rate of change
Multiply by 10000 for readable scale
Result oscillates around zero line

Default Parameters: #

Period: 14 (for all three EMA calculations)
Signal Line: 9-period simple moving average of TRIX
Scale: Typically -2 to +2 range
Centerline: Zero (0)

Signal Generation: #

TRIX > 0: Bullish momentum (above zero line)
TRIX < 0: Bearish momentum (below zero line)
TRIX Crossover Signal Line: Entry/exit signals
Zero Line Crossover: Major trend change indication

TRIX Characteristics #

Noise Reduction Properties #

Triple exponential smoothing creates exceptional noise filtering:

Lag Characteristics: Significant lag due to triple smoothing
False Signal Reduction: Eliminates most whipsaw movements
Trend Focus: Emphasizes major momentum changes
Stability: Smooth oscillation patterns

Zero-Centered Design #

Centerline provides clear reference point:

Directional Bias: Above/below zero indicates trend bias
Momentum Measurement: Distance from zero shows momentum strength
Crossover Significance: Zero line breaks indicate major changes
Symmetrical Range: Oscillates relatively equally above/below zero

Momentum Sensitivity #

Despite smoothing, maintains momentum responsiveness:

Rate of Change: Measures velocity of triple-smoothed average
Trend Acceleration: Shows when trends are gaining momentum
Momentum Exhaustion: Indicates when momentum is slowing
Directional Changes: Identifies momentum direction shifts

Standard TRIX Analysis #

Basic Signal Types: #

Signal Type	Description	Strength	Best Use
Zero Line Cross	TRIX crosses above/below zero	High	Trend change
Signal Line Cross	TRIX crosses signal line	Medium	Entry/exit timing
Divergence	TRIX/price direction conflict	High	Reversal warning
Momentum Extreme	TRIX reaches high/low levels	Medium	Trend exhaustion

Zero Line Analysis: #

TRIX Above Zero Line:

Interpretation: Bullish momentum and trend bias
Strategy: Look for long opportunities and trend continuation
Confirmation: Sustained readings above zero strengthen signal
Caution: Distance from zero indicates momentum strength

TRIX Below Zero Line:

Interpretation: Bearish momentum and trend bias
Strategy: Consider short opportunities and bearish bias
Confirmation: Sustained readings below zero confirm bearish trend
Assessment: Depth below zero shows bearish momentum strength

Zero Line Crossovers:

Bullish Crossover: TRIX moves from negative to positive
Bearish Crossover: TRIX moves from positive to negative
Significance: Major trend change indication
Confirmation: Wait for sustained move in new direction

Signal Line Interaction: #

Bullish Signal: TRIX crosses above signal line
Bearish Signal: TRIX crosses below signal line
Context: More reliable when aligned with zero line position
Timing: Provides earlier entry/exit than zero line crosses

Trading Strategies #

1. TRIX Zero Line Crossover Strategy #

Setup: Trade major trend changes using zero line crossovers Bullish Setup:

TRIX crosses above zero line from below
Sustained move above zero for confirmation
Price action supports bullish interpretation
Volume increase confirms momentum shift

Bearish Setup:

TRIX crosses below zero line from above
Sustained move below zero for confirmation
Price shows bearish characteristics
Selling pressure evident in price action

Entry Confirmation:

Wait for decisive crossover, not just touch
Confirm with price breaking key resistance/support
Use additional indicators for validation
Consider higher timeframe alignment

Risk Management:

Stop loss if TRIX quickly reverses back
Position sizing based on volatility
Target levels at previous swing extremes
Trail stops as trend develops

2. TRIX Signal Line Crossover Strategy #

Setup: Use TRIX and signal line crossovers for entry timing Long Signal:

TRIX crosses above its signal line
Preferably when both lines above zero
Price above key moving averages
Bullish price action confirmation

Short Signal:

TRIX crosses below its signal line
Preferably when both lines below zero
Price below key moving averages
Bearish price action confirmation

Signal Quality Assessment:

Crossovers above zero line more reliable for longs
Crossovers below zero line more reliable for shorts
Distance between lines indicates signal strength
Angle of crossover shows momentum

Exit Strategy:

Exit on opposite signal line crossover
Partial profits at resistance/support levels
Stop loss on significant TRIX reversal
Trail stops using signal line as reference

3. TRIX Divergence Strategy #

Setup: Trade momentum divergences between TRIX and price Bullish Divergence:

Price makes lower lows
TRIX makes higher lows
Divergence occurs in bearish territory (below zero)
Entry on TRIX zero line break or signal line cross

Bearish Divergence:

Price makes higher highs
TRIX makes lower highs
Divergence occurs in bullish territory (above zero)
Entry on TRIX zero line break or signal line cross

Divergence Validation:

Multiple divergent points increase reliability
Confirm with support/resistance levels
Volume patterns should support divergence
Use other oscillators for confirmation

Implementation Guidelines:

Draw trendlines on both price and TRIX
Look for 2-3 consecutive divergent points
Hidden divergences signal trend continuation
Regular divergences suggest potential reversals

4. TRIX Trend Following Strategy #

Setup: Use TRIX to ride established trends with proper timing Uptrend Following:

Identify uptrend using higher timeframe analysis
TRIX consistently above zero line
Enter on TRIX pullbacks to signal line
Add positions on TRIX momentum increases

Downtrend Following:

Confirm downtrend on higher timeframe
TRIX consistently below zero line
Enter on TRIX rallies to signal line
Add positions on TRIX momentum increases downward

Trend Confirmation Criteria:

TRIX aligned with trend direction
Signal line supporting trend bias
Price action confirms trend strength
Volume patterns support trend direction

Position Management:

Use signal line as trailing stop reference
Add to positions on TRIX momentum expansion
Reduce positions on TRIX momentum contraction
Exit completely on trend reversal signals

Combining TRIX with Other Indicators #

TRIX + Moving Averages #

Trend Context Enhancement:

Moving averages define overall trend direction
TRIX provides momentum confirmation and timing
Trade TRIX signals only in MA trend direction
MA slope confirms TRIX momentum readings

Implementation Method:

50/200 MA for long-term trend identification
TRIX zero line cross + MA alignment = strong signal
TRIX pullbacks in trending markets for entries
MA crossovers validated by TRIX momentum

TRIX + RSI #

Dual Momentum Analysis:

RSI provides additional momentum perspective
TRIX smoothness complements RSI sensitivity
Divergences on both indicators highly significant
Overbought/oversold RSI with TRIX confirmation

Signal Integration:

RSI extremes with TRIX divergence for reversals
Both oscillators trending same direction for strength
RSI oversold + TRIX bullish cross = strong buy
RSI overbought + TRIX bearish cross = strong sell

TRIX + MACD #

Momentum and Trend Convergence:

MACD histogram confirms TRIX momentum
MACD signal line validates TRIX direction
Both indicators smoothed but different calculations
Combined signals reduce false entries

Trading Application:

MACD above signal + TRIX above zero = bullish bias
MACD histogram expanding + TRIX momentum = trend strength
Divergences on both create high-probability reversals
Signal line crosses on both for precise timing

TRIX + Volume #

Momentum Validation:

Volume confirms TRIX momentum signals
TRIX crossovers with volume expansion more reliable
Volume patterns support TRIX divergences
Low volume TRIX signals often fail

Analysis Framework:

Volume spike + TRIX zero line cross = strong signal
Volume divergence warns of TRIX signal failure
On-balance volume confirms TRIX trend direction
Volume moving averages validate TRIX momentum

Market Condition Analysis #

Trending Markets #

TRIX Performance:

Excellent for identifying and confirming trends
Zero line clearly separates bullish/bearish phases
Smooth signals reduce trend-following noise
Signal line provides good trending entries

Trading Approach:

Focus on zero line alignment with trend
Use signal line for entry timing
Avoid counter-trend TRIX signals
Trail stops using signal line reference

Ranging Markets #

TRIX Performance:

Less effective due to smoothing lag
May miss shorter-term range reversals
Zero line oscillation provides some guidance
Signal line crossovers can work for range trading

Trading Approach:

Use shorter TRIX periods for responsiveness
Combine with other oscillators for range signals
Focus on divergences at range boundaries
Reduce position sizes due to lower reliability

Volatile Markets #

TRIX Performance:

Triple smoothing filters volatility noise effectively
Provides stable signals during chaotic periods
May lag significantly during rapid changes
Less prone to false signals than faster indicators

Trading Approach:

Maintain standard parameters for stability
Use shorter timeframes for better responsiveness
Combine with faster indicators for confirmation
Patient approach works better than reactive trading

Advanced TRIX Techniques #

Multiple Timeframe TRIX #

Strategy: Use TRIX across different timeframes for comprehensive analysis

Higher Timeframe: Overall trend and major signals
Trading Timeframe: Entry and exit timing
Lower Timeframe: Precise execution confirmation

Implementation:

Weekly TRIX for long-term trend bias
Daily TRIX for swing trading signals
Hourly TRIX for day trading timing
All timeframes should align for strongest signals

Custom TRIX Periods #

Period Optimization:

Shorter Periods (9-12): More responsive, faster signals
Standard Period (14): Balanced smoothing and responsiveness
Longer Periods (18-21): Smoother signals, fewer false positives
Multiple Periods: Use 2-3 different settings for confirmation

Application Guidelines:

Shorter periods for active trading styles
Longer periods for position trading
Multiple periods for signal confirmation
Match period to average trend duration

TRIX Histogram Analysis #

Alternative Display Method:

Plot TRIX as histogram bars instead of line
Easier visualization of momentum changes
Bar height shows momentum strength
Color coding for positive/negative values

Histogram Benefits:

Clearer momentum visualization
Easier to spot momentum divergences
Better for identifying momentum exhaustion
Intuitive interpretation of strength changes

TRIX Rate of Change #

Advanced Momentum Measurement:

Calculate rate of change of TRIX itself
Identifies acceleration/deceleration of momentum
Second derivative analysis of price movement
Early warning of momentum shifts

Application Method:

ROC of TRIX for momentum acceleration
Positive ROC = momentum increasing
Negative ROC = momentum decreasing
Zero line crosses indicate momentum inflection points

Common TRIX Mistakes #

Mistake 1: Ignoring the Lag #

Problem: Expecting immediate signals from heavily smoothed indicator Solution: Accept lag as trade-off for noise reduction and signal quality

Mistake 2: Overcomplicating Analysis #

Problem: Using too many TRIX variants or periods simultaneously Solution: Stick to standard settings and focus on basic signals

Mistake 3: Trading Against Zero Line Bias #

Problem: Taking signals that contradict TRIX zero line position Solution: Align trades with TRIX directional bias above/below zero

Mistake 4: Insufficient Confirmation #

Problem: Trading TRIX signals without additional confirmation Solution: Use price action, volume, or other indicators for validation

Mistake 5: Wrong Timeframe Application #

Problem: Using TRIX on timeframes too short for its smoothing Solution: Apply TRIX to appropriate timeframes matching trading style

TRIX Settings by Market #

Stock Markets #

Recommended: Standard 14-period setting

Works well for daily and weekly stock analysis
Consider earnings periods for signal interpretation
Individual stocks may need period adjustment
Sector analysis benefits from consistent parameters

Forex Markets #

Recommended: 14-period, consider 18-21 for major pairs

24-hour market may benefit from longer periods
Major pairs respond well to standard settings
Cross-currency pairs may need optimization
Economic news can override TRIX signals temporarily

Cryptocurrency Markets #

Mixed Settings: 12-18 period range depending on volatility

High volatility may require longer periods
24/7 trading affects optimal parameters
Consider market maturity and liquidity
Bitcoin often uses standard settings well

Futures Markets #

Standard to Custom: 14-period base, adjust per contract

Contract specifications may affect optimal period
Consider seasonal patterns in agricultural futures
Energy futures often use standard settings
Metal futures may benefit from longer periods

TRIX Optimization #

Parameter Testing: #

Test periods from 9 to 21
Evaluate signal line periods from 7 to 12
Consider different EMA vs SMA for signal line
Test performance across various market conditions

Performance Metrics: #

Signal accuracy vs. signal frequency
Lag vs. noise reduction trade-offs
Performance during trending vs. ranging markets
Risk-adjusted returns across timeframes

Optimization Best Practices: #

Avoid over-optimization to recent data
Test across multiple instruments and timeframes
Consider transaction costs in signal evaluation
Maintain focus on signal quality over quantity

FAQs #

What makes TRIX different from other momentum oscillators? #

TRIX uses triple exponential smoothing, making it much less noisy than most oscillators while maintaining momentum sensitivity. This creates more reliable signals with less whipsaw but with increased lag.

Why does TRIX use triple smoothing? #

Triple smoothing eliminates short-term market noise while preserving underlying momentum trends. Each smoothing layer reduces noise while the final rate-of-change calculation maintains momentum sensitivity.

How should TRIX lag be handled in trading? #

Accept the lag as a trade-off for signal quality. Use TRIX for trend identification and major signals, and combine with faster indicators for timing if needed.

What’s the significance of TRIX zero line crossovers? #

Zero line crossovers indicate major momentum shifts and trend changes. They’re among the most reliable TRIX signals but come with lag, so confirmation from price action is valuable.

Can TRIX be used for day trading? #

While possible, TRIX is better suited for swing trading and longer timeframes due to its smoothing. Day traders should use shorter periods or combine with faster indicators.

How reliable are TRIX divergences? #

TRIX divergences are highly reliable due to the indicator’s smooth nature, which filters out false divergence signals common in noisier oscillators. They’re among TRIX’s strongest signals.

Should the signal line period be adjusted? #

The standard 9-period signal line works well for most applications. Shorter periods provide faster signals but more noise; longer periods provide smoother signals but more lag.

Tips for Success #

Embrace the Lag: Accept TRIX’s lag as the price for signal quality
Zero Line Focus: Pay primary attention to zero line position and crossovers
Signal Line Timing: Use signal line for entry/exit timing within trend bias
Divergence Priority: Give highest weight to TRIX divergence signals
Trend Alignment: Trade in direction of TRIX zero line bias
Multiple Timeframes: Use higher timeframes for context, lower for timing
Volume Confirmation: Strengthen TRIX signals with volume analysis
Patience Required: Wait for clear signals rather than forcing trades
Trend Following: TRIX works best in trending market conditions
Simple Application: Focus on basic signals before attempting complex combinations

Conclusion #

TRIX stands out in the crowded field of momentum oscillators through its unique triple exponential smoothing approach, which creates remarkably clean signals by filtering out the market noise that plagues many other indicators. This smoothing comes at the cost of some lag, but the trade-off results in signals that are far more reliable and less prone to false entries and exits.

The indicator’s greatest strength lies in its ability to identify significant momentum changes and trend shifts while maintaining clarity in its signals. The zero-line crossovers provide clear directional bias, while the signal line offers precise timing opportunities. When combined with proper trend analysis and risk management, TRIX can form the backbone of a robust trading system.

Success with TRIX requires patience and an appreciation for its deliberate, smooth nature. Rather than fighting the lag, successful traders learn to use it as a filter for quality over quantity in their trading signals. The indicator works best when viewed as a trend-following tool that excels at identifying major moves rather than capturing every minor market fluctuation.

Remember: TRIX is designed for traders who prefer fewer, higher-quality signals over frequent trading opportunities. Its triple smoothing creates signals that are worth waiting for, making it particularly valuable for swing traders and position traders who can afford to be patient for the right setup. Master its basic zero-line and signal-line interactions before exploring more complex applications, and always consider the indicator’s inherent lag when timing entries and exits.

Divergence Detection, Momentum Indicator, Oscillator, Trend Indicator