Indicators

Vortex Indicator: How to Set Up and Use It

Astron Team · 09/24/2026 · 4 min read

The Vortex indicator was born from an uncommon inspiration among technical analysis tools: its creators, Etienne Botes and Douglas Siepman, drew on observations by Austrian inventor Viktor Schauberger about water flow, suggesting that financial market movements could resemble the vortex patterns observed in nature. In practice, the result is a two-line trend indicator, simpler to interpret than the analogy suggests.

The idea behind the calculation

The Vortex measures the distance between the current candle's low and the previous candle's high (upward movement), and the distance between the current candle's high and the previous candle's low (downward movement). The larger one of these distances is relative to the other, the stronger the corresponding directional move. These two measures, smoothed over a period (14 by default), form the indicator's two lines: VI+ (upward movement) and VI- (downward movement).

The calculation also considers each candle's true range — the same concept used in the ATR and the ADX — which helps the indicator capture movement even when there are gaps between candles.

How to configure it

The Vortex falls into the momentum (or trend, depending on the platform) indicator category and uses, by default, a period of 14 for its two main lines. The overbought and oversold levels usually come configured at 1.1 and 0.9, respectively, although these two levels carry less weight in the indicator's reading than the crossover between the VI+ and VI- lines themselves.

How to read the signals

• Bullish signal: the VI+ line is below VI-, crosses above it, and stays above — indicating the upward move has become dominant.
• Bearish signal: the VI- line is below VI+, crosses above it, and stays above — indicating the downward move has become dominant.
• Distance between the lines: the wider the gap between VI+ and VI- after the crossover, the stronger the ongoing trend is considered to be.

An example: on a currency pair where VI- had been above VI+ for several weeks (downtrend), VI+ crosses above VI- and the distance between the two lines starts widening on the following candles. This combination — crossover plus widening distance — is read as confirmation the trend has changed direction, not just an isolated crossover that could reverse on the next candle.

Not every crossover should become an entry

A crossover between VI+ and VI- shouldn't be treated as an automatic buy or sell order, but rather as an invitation to pay closer attention to the asset: check the price's recent behavior, assess whether there's a relevant support or resistance nearby, and only then consider an entry in the indicated direction. In markets with no clear trend, crossovers tend to repeat several times in a short span, without generating an exploitable move — the same false-signal problem that affects practically every trend indicator in sideways markets.

Combining the Vortex with other indicators

Since it measures only trend, the Vortex benefits from being combined with an indicator of a different nature, rather than another trend indicator measuring essentially the same thing. The MACD and the ADX are often cited as good complements: the MACD reinforces the momentum reading, and the ADX helps confirm whether the trend strength signaled by the Vortex crossover is actually relevant enough to justify an entry.

Risk management is still necessary

Like any trend indicator, the Vortex isn't always right, and a strategy built on it should include a stop-loss and, when it makes sense, a defined take-profit target before entering. No tool, no matter how elaborate the logic behind it, delivers correct signals all the time — and treating the Vortex otherwise would be ignoring how any trend strategy actually behaves across many trades.

It's also worth testing the indicator on different assets and time frames before relying on it for real trades: a 14-period setting that works well on a daily stock chart may not produce the same results on an intraday chart of a currency pair, given the difference in volatility and behavior between the two markets.