Average True Range definition

The Average True range (ATR) is a useful barometer of an asset’s volatility. The Average True Range (ATR) of an asset is a historical volatility indicator that calculates the average of historical true range values. ATR is particularly useful in portfolio management since it allows us to examine an asset’s historical volatility for different timeframes (1-day, 1-week, 1-month, 3-months) and set stop losses and profit targets for a specific investment.

Average True Range formula

Average True Range (ATR) Excel

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