The reconfiguration of the global production system after the 2008 financial crisis, as well as the long-term, disproportionately high economic growth across different regions in China, highlighted the importance of China’s new development pattern of “dual circulation” as a key strategy for promoting high-quality economic development. Conducting a scientific industry relocation is the main approach to constructing the “dual circulation”. As a result, the industry gradient coefficient (IGC) is increasingly adopted to support decision making in industry relocation. This paper theoretically demonstrates that the IGC can be used to reveal the direction of industry relocation. After that, a newly proposed approach is adopted to test its accuracy. It is found that the first-order difference of the IGC is a qualified indicator of the direction of industry relocation. Its accuracy is not affected by the time span or by the relocation opposite to the changes in competitive advantages, but is mainly impacted by the hysteresis of relocation and the buffering effect for industries with a huge advantage. On the other hand, the hysteresis of relocation grants the predictive ability to the industry gradient coefficient.