Average True Range (ATR)

Average True Range (ATR)

Description

The Average True Range (ATR) study measures the size of the period’s range, and takes into account any gap from the close of the previous period.

Formula

ATR = Average ( True Range, n )

Where:

• True Range = Max of ( High - Low ), ( High -PreviousClose ), ( PreviousClose - Low )
• Average = Simple, Exponential, Weighted, and Triangular
• n = Time period

Example