Average True Range - ATR
Definition of '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. |
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Investopedia explains 'Average True Range - ATR'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. |
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