Average True Range (ATR)
A measure of volatility introduced by Welles Wilder in his book: New Concepts in Technical Trading Systems.
The True Range indicator is the greatest of the following:
-current high less the current low.
-the absolute value of the current high less the previous close.
-the absolute value of the current low less the previous close.
The Average True Range is a moving average (generally 14-days) of the True Ranges. Investopedia Says:
Wilder originally developed the ATR for commodities but the indicator can also be used for stocks and indexes. Simply put, a stock experiencing a high level of volatility will have a higher ATR, and a low volatility stock will have a lower ATR. Related Terms:
Moving Average
Technical Analysis Terms
Volatility |