The Fractal Dimension Index (FDI) is a technical indicator used in financial markets to analyze the complexity of price movements over a specified period. It helps in identifying whether the market is trending or in a trading range. The FDI values range between 1 and 2, where values closer to 1 indicate a more linear or trending market, and values closer to 2 suggest a more chaotic or range-bound market.

Syntax:

FractalDimensionIndex[period](price)

• period: The number of bars used for the calculation. The default is 30.
• price: The price type applied (e.g., close, open, high, low).

Example:

To calculate the Fractal Dimension Index for a 30-period based on closing prices, you would use:

FDIValue = FractalDimensionIndex[30](close)

Interpretation:

• A FDI value less than 1.5 suggests that the market is trending. The lower the value, the stronger the trend.
• A FDI value greater than 1.5 indicates that the market is in a trading range, showing more random price movements.

This indicator does not provide information about the direction of the trend, only the nature of the market behavior (trending or ranging). Understanding the FDI can help traders adjust their strategies according to the prevailing market conditions.