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peterdv

Average True Range Overlay

peterdv  
ATR
334
22
atr
Plots ATR calculated on a daily basis as an overlay on the current chart.

Implemented using the builtin atr function.

ATR is a volatility indicator
originally developed by J. Welles Wilder, Jr. for commodities:
New Concepts in Technical Trading Systems. Greensboro, NC: Trend Research. ISBN 978-0-89459-027-6.

The range of a day's trading is simply R = high − low.
The true range extends it to yesterday's closing price if it was outside of today's range:
TR = max

The average true range is an N-day smoothed moving average of the TR values.

A first stab at a sensible stop loss level might be 3*ATR below recent peak.
Open-source script

In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.

Disclaimer

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