TRIX indicator: triple smoothing, signal line and zero line

What the TRIX indicator measures

TRIX is a momentum oscillator built from a moving average that has been smoothed three times. Jack Hutson introduced it in Technical Analysis of Stocks & Commodities in 1983. The indicator tracks the slope of the triple-smoothed average: it is positive when the average is rising, negative when it is falling and zero when it is flat.

• Inputs: closing prices.
• Settings: the period of the three averages, with 15 a common choice, and the period of an optional signal line, often 9.
• Units: percent per period. On daily charts readings are usually a small fraction of 1%, because a triple-smoothed average moves slowly.
• Cadence: each period is one session on a daily chart.

Hutson’s 1984 description smoothed the logarithm of the closes and took a one-session difference. Many charts instead smooth the closes themselves and report a percentage change; for ordinary daily moves the two versions draw nearly the same line, but platforms do not all scale the result the same way, so compare readings only within one tool.

How TRIX is calculated

Take an exponential moving average of the closes, an EMA of that average and an EMA of the second average, all with the same period. TRIX is the percentage change of the third average from one session to the next. A signal line, usually a 9-period EMA of TRIX, is often drawn with it.

EMA1 = EMA(Close, n)
EMA2 = EMA(EMA1, n)
EMA3 = EMA(EMA2, n)
TRIX = (EMA3 today / EMA3 previous session − 1) × 100
Signal = EMA(TRIX, m)
EMA today = α × Input today + (1 − α) × EMA previous session, with α = 2 / (n + 1)

Each average needs a starting value. If every EMA starts from a simple average of its first n inputs, a 15-period TRIX prints its first value at session 44 and a 9-period signal line at session 52. If each EMA starts from its first input instead, values appear at once but carry that starting assumption for many sessions, so early readings differ from one platform to another.

A worked smoothing example

The tables use a three-period setting, which makes α equal to 0.5: each new average value is the midpoint of the new input and the previous average. Every EMA starts from its first input, and the signal line is a three-period EMA of TRIX. The closes are hypothetical, and the short period is chosen only so that the arithmetic can be followed by hand.

The closes peak at session 5 at $21.53, and TRIX peaks there too, at +1.274%. It then slows: TRIX falls below its signal line at session 7, touches zero at session 8 when EMA3 is unchanged at $21.030, and turns negative at session 9.

Zero-line crossovers

TRIX above zero means the triple-smoothed average is rising; below zero, it is falling. A crossing therefore marks the session when that average changes direction. Because price has passed through three layers of smoothing, the crossing usually comes well after the turn in price.

In the hypothetical chart on this page, which uses 15-period averages and a 9-period signal line, TRIX crosses below zero 17 sessions after the closing high.

Signal-line crossovers

The signal line is a moving average of TRIX itself. When TRIX drops below it, the slope of the triple-smoothed average is weakening faster than its recent average; when TRIX rises above it, the slope is improving. These crossings come earlier than zero-line crossings and also more often, including small ones that reverse within days.

In the worked example, TRIX crosses below its signal at session 7, one session before it reaches zero. The chart on this page shows the same order on a longer scale: the signal-line cross comes one session after the closing high, the zero-line cross 17 sessions after it.

How to read TRIX on a stock chart

TRIX is drawn in a separate pane, usually with a zero line and a dashed or colored signal line. Read it in three steps: which side of zero it is on, whether it is rising or falling, and where it stands relative to the signal line. Then look back at the price pane to see what the smoothing is summarizing.

1. Check the period. TRIX with n = 9 reacts much faster than TRIX with n = 20.
2. Read the side of zero for the direction of the smoothed trend.
3. Read the slope for acceleration: a falling TRIX above zero means the advance continues but is slowing.
4. Use signal-line crossings as early, noisier notices of a change in slope.

TRIX divergence on a stock chart

A bearish divergence forms when price reaches a higher high while TRIX peaks lower; a bullish divergence when price makes a lower low while TRIX bottoms higher. On the hypothetical chart, TRIX peaks four sessions before the closing high: price keeps climbing while the slope of the smoothed average is already shrinking.

Smoothing makes TRIX divergences rarer and slower to appear than divergences on raw momentum lines such as the rate of change indicator. A divergence describes slowing momentum, and trends can continue for a long time after one appears.

Limitations of TRIX

The same smoothing that makes TRIX calm also makes it slow. Several other choices behind the line differ between platforms.

• Lag. Three averages in a row delay every turn, so crossings tend to confirm a move that is already well under way.
• Warm-up and starting values. Early readings depend on how each average was started, as described above.
• Flat markets. When the smoothed average is nearly flat, TRIX hovers around zero and crosses it, and its signal line, repeatedly.
• Scaling. Daily values are small fractions of a percent, and platforms present them differently.
• No volume and no fixed extremes. TRIX uses closes only and has no standard overbought or oversold levels.

TRIX compared with MACD in TradeClever charts

TradeClever’s Stock Charts do not plot TRIX. The closest view there is the MACD pane, which tracks the gap between two EMAs of the close in dollars, with its own signal line and configurable periods, while TRIX tracks the slope of one triple-smoothed EMA in percent. You can also add an EMA overlay to the price chart to see how a single smoothing pass follows the closes.