Abbreviation: DMI ExpAvg Diff
Category: Price Momentum Indicators: Smoothed
Input Parameters:

 
Calculation:

ExpAvg(X, ExpAvg1 Periods) – ExpAvg(X, ExpAvg2 Periods)

where
X = DMI(High Price, Low Price, Closing Price, DMI Periods)

DMI represents Directional Movement Index (DMI)
ExpAvg represents Exponential Moving Average

 
Discussion:

This indicator attempts to quantify movements in the Directional Movement Index indicator by calculating the difference between two moving averages. Since it uses exponential moving averages (which give more importance to the most recent periods than to less recent periods), the indicator tends to focus more upon movement occurring in the most recent periods.
Difference between NeuroShell’s DMI indicator and Wilder’s Original DMI:

Note that NeuroShell’s DMI indicator is based upon TradeStation’s DMI implementation and is therefore different from Wilder’s original. The DMI uses an exponential moving averages (EMA). NeuroShell Trader’s EMA period has a different meaning as compared to Wilder’s original EMA period, because Wilder used a different type of EMA. Here is how they relate to each other:

NeuroShell Trader’s EMA period = Wilder’s EMA period * 2 – 1 

This applies to the DMI Periods parameter.

For example, suppose you want to match Wilder’s indicator using two periods of 14 bars each. To be able to re-create the results in NeuroShell Trader, you should use 14*2-1=27 bar periods for the DMI periods.

NeuroShell Trader’s version of DMI matches Wilder’s when you use (Wilder’s EMA period * 2 – 1) value for the period parameter.