Understanding the Average True Range (ATR) trading strategy is pivotal for any trader aiming to navigate market volatility effectively. ATR doesn’t just measure volatility—it empowers you to set smarter stop-loss orders, adjust position sizes, and time your trade entries and exits with precision. This article will guide you through practical applications of ATR, giving insights into how this essential technical indicator can fine-tune your trading decisions for diverse market scenarios.
Key Takeaways
Unveiling the Average True Range (ATR) Indicator
Created in 1978 by J. Welles Wilder, the ATR indicator is a unique tool in the world of technical analysis. Unlike many other technical indicators, ATR does not provide directional signals. Instead, it focuses on measuring market volatility caused by gaps and limit moves. ATR gives a clear picture of the degree of price volatility by showing the average price fluctuation within a given time frame without suggesting the price trend or predicting future price movements.
It is no wonder that ATR continues to hold its own in the evolving landscape of technical analysis tools.
The Mechanics Behind ATR Calculation
Delving into the mechanics behind ATR calculation, we encounter the concept of True Range—a fundamental component of the ATR calculation. It represents the absolute price changes over a period, defined by the current high to the current low and the current high or low to the previous close.
The ATR, which is calculated using historical price data, is then determined by averaging these True Ranges over a series of periods, often the most recent 14 days, thus providing a smoothed measure of market volatility.
Deciphering True Range
The True Range is the backbone of the Average True Range (ATR) indicator, serving as the basic building block for measuring market volatility. It is calculated by identifying the maximum difference among three price differences: the current high minus the previous close, the current low minus the previous close, and the current high minus the current low. By utilizing the Average True Range Indicator, traders can better understand the market’s volatility and make more informed decisions based on the average true range value.
Getting a grasp of the True Range is essential for leveraging the ATR in market analysis as it provides a measure of volatility that takes into account gaps and limit moves in price action.
The ATR Formula
Moving on to the ATR formula, it is defined as ATR = (Previous ATR * (n - 1) + Current TR) / n, where ‘TR’ stands for True Range and ‘n’ represents the number of periods. Wilder made this calculation process smoother by incorporating the previous period’s ATR value to manage data volatility.
This ingenious formula stands as a testament to Wilder’s contribution to the field of technical analysis.
Crafting an ATR-Based Trading Strategy
Crafting an ATR-based trading strategy can significantly enhance your trading performance. ATR is pivotal in setting stop-loss and take-profit limits in technical trading systems. Its ability to complement a trading system by providing additional entry or exit signals enhances the strategic approach of traders.
Moreover, rising ATR values can alert traders of potentially larger price movements ahead, giving them a heads-up to adjust their trading tactics accordingly.
Setting Stop Losses with ATR
When it comes to setting stop losses with ATR, traders usually set wider stop-loss orders when ATR indicates higher volatility and smaller stop-loss orders when ATR values suggest lower volatility. This strategy helps maintain a consistent risk-reward ratio and reduces emotional stress by providing an objective exit rule.
While ATR-based stop loss strategy is effective, it may require adjustments, such as backtesting or modifying ATR settings, to account for other price-influencing factors like support and resistance levels.
Determining Position Sizes
The ATR-based position sizing strategy allows for adjustments based on an individual trader’s risk tolerance, aligned with the volatility of the market they are trading in. The position size can be determined using the formula A/B, where A represents the percentage of the trader’s account they are willing to risk, and B is the current ATR value.
This strategy takes into account the varying average sizes of price movements within different time frames, making it an essential tool in the trader’s arsenal.
Integrating ATR with Other Technical Indicators
The versatility of ATR extends to its ability to be integrated with other technical indicators to develop comprehensive trading strategies. For instance, ATR can adapt to function like an exponential moving average, with a greater emphasis on the most recent price movements to reflect current market volatility.
Furthermore, integration of ATR with Parabolic SAR provides traders with concrete stop loss price points, enhancing risk management by adapting to market trends.
Complementing ATR with Moving Averages
Combining ATR with moving averages can be a game-changer for traders. This combination helps assess trend strength and provides insight into the sustainability of the current price movement. The interaction between ATR and moving averages can signal potential trend reversals, providing traders with an opportunity to adjust their positions accordingly.
This strategy results in more precise price targets and serves as a signal line, confirming trend direction.
Enhancing Signals with Bollinger Bands and ATR
Integrating ATR with Bollinger Bands can help traders gauge the volatility and potential market direction of a currency pair, with high volatility readings from the ATR and the overbought or oversold conditions suggested by Bollinger Bands combining to indicate potential entry points.
Traders can adjust the ATR period settings based on current market conditions, opting for shorter periods for a faster response to price movements or longer periods for more stable volatility analysis over time.
Identifying Market Direction Using ATR
Identifying market direction using ATR is a significant aspect of trading. High ATR values commonly occur during significant price movements, suggesting a strong trend or the beginning of a new one when prices move substantially from a recent close. Conversely, a decrease in ATR is typically representative of less dramatic price changes or sideways markets, which can be indicative of a consolidation phase.
By monitoring the ATR for changes over time, traders can identify potential market waves, consolidation periods, and the likelihood of trend continuation or reversal.
ATR and the Chandelier Exit Technique
The Chandelier Exit technique uses ATR to set a trailing stop below the highest high reached since entering the trade, adjusting the stop as the market moves. This strategy becomes more adaptable with the incorporation of the anchored chandelier stop, which provides a spectrum of anchoring choices for various trading scenarios.
By backtesting various anchoring methods in relation to ATR values, traders can determine the most effective stop-loss strategy that complements their overall trading approach and risk management goals.
ATR Percent (ATRP): A Comparative Approach
ATRP is a variation of the ATR that measures volatility as a percentage and enables comparisons between securities with different prices. It provides a method to compare the volatility of different securities on the same scale by expressing the ATR as a percentage of the closing price. By doing so, the ATRP can help identify securities with higher volatility compared to others, which can be useful in asset selection and risk management.
Leveraging ATR for Day Trading
Leveraging ATR for day trading can add dynamism to a trader’s strategy. Day traders commonly use a 15-minute timeframe to apply ATR for determining potential trades for the day, which helps in assessing short-term volatility. For day trading, entry points can be determined by adding and subtracting the ATR value from the closing price of the first 15-minute bar, with stops set to exit at a loss if prices revert to that bar’s close.
During day trading, position sizes can be adjusted by adding or subtracting a multiple of the ATR from the closing price of a specified period, allowing for flexibility in response to volatility.
Long-Term Strategies: ATR in Swing and Position Trading
ATR is a key indicator in swing and position trading for assessing market volatility and potential price movement over longer time frames. A 10-period ATR, which accounts for the previous day’s price range, can guide traders in making more informed decisions about their trades, aligning them with the latest market dynamics.
In swing and position trading, ATR values help traders determine optimal entry points by providing insights into the expected price volatility and movements.
ATR Value Analysis: What Constitutes High and Low Volatility?
Understanding what constitutes high and low volatility can be a game-changer for traders. A rise in ATR values typically suggests an increase in market volatility, often associated with the development of a strong market trend or a possible trend reversal. In contrast, when ATR values diminish, it could indicate a decrease in market volatility, signaling that the market may be consolidating or entering a period of less directional movement.
Understanding the normal range for an asset’s ATR can provide a baseline for judging current volatility; deviations from this range can lead to further analysis or strategic decisions in trading.
Real-World Applications: Case Studies and Examples
The real-world applications of ATR are vast. The setting of chandelier stops can be customized with different anchoring options, which allows traders to use ATR values in flexible ways to determine stop-loss levels. Various anchoring options for chandelier stops include the highest high, lowest low, and other specific points like the highest volume or specific candle formations, each impacting the stop-loss differently due to ATR fluctuations.
By backtesting various anchoring methods in relation to ATR values, traders can determine the most effective stop-loss strategy that complements their overall trading approach and risk management goals.
What is Average True Range (ATR) in trading?
The Average True Range (ATR) is a technical analysis indicator used to measure market volatility by calculating the average price fluctuation of an asset over a specified timeframe. ATR includes price gaps in its calculations to provide a comprehensive view of price movements. Typically, ATR is computed over 14 periods which could be interpreted as days, weeks, or any other time interval relevant to the trader.
A high ATR value suggests that the asset is experiencing high market volatility, which can lead to fluctuations in the asset’s price, while a low ATR indicates reduced price variability.
How does ATR measure market volatility?
The Average True Range (ATR) measures market volatility by determining the full range of price movement for an asset within a specific period. To calculate ATR, the true range is taken as the greatest value from the following options:
A moving average of the true ranges, typically over a 14-day period, is used to compute the ATR.
Though initially designed for commodities markets, the market volatility indicator, ATR, is now used across various types of securities to measure price volatility. The ATR does not show the direction of price movement; instead, it focuses on the level of price volatility.
Why is ATR important for traders?
The ATR is crucial for traders as it measures market volatility, allowing for adjustments in trading strategies to accommodate varying market conditions. Traders use the ATR to evaluate the intensity of price movements where high ATR values indicate strong trends and significant market interest. A decrease in the ATR value can suggest a decline in volatility, hinting at a consolidating or range-bound market.
The ATR indicator aids traders in managing risk by providing a basis for setting stop-loss orders that factor in current market volatility. The ATR is versatile and can be applied to different financial instruments and timeframes, enhancing its utility for various trading approaches.
How to calculate ATR?
To calculate Average True Range (ATR), one must first determine the True Range (TR) by selecting the largest value from the following three differences: the current high minus the previous close, the current low minus the previous close, and the current high minus the current low. After establishing the True Range for a set of time periods, the ATR is calculated by averaging these TR values over the chosen time frame, which is commonly 14 periods as initially suggested by J. Welles Wilder, the creator of the ATR indicator.
The ATR formula can be applied as follows: ATR = (Prior ATR x (n - 1) + Current TR) / n, where ‘n’ stands for the number of periods, and ‘TR’ is the True Range.
Can ATR help in setting stop-loss levels?
ATR is a highly effective tool that assists traders in setting stop-loss levels. The ATR Trailing Stop is an indicator derived from the Average True Range and is designed to help traders set stop-loss levels that account for market volatility. Traders can adjust the ATR Trailing Stop by choosing a multiple to apply to the ATR, with a higher multiple giving a wider stop to accommodate larger price fluctuations.
The ATR Trailing Stop placement changes with price trends, indicating a bullish trend when below the price and a bearish trend when above it. Entry and exit trading signals can be generated by the ATR Trailing Stop, with trend reversals indicated by the price crossing this stop level.
How does ATR assist in determining position size?
ATR is instrumental in determining position size. The ATR-based position sizing strategy allows for adjustments based on an individual trader’s risk tolerance, aligned with the volatility of the market they are trading in.
The position size can be determined using the formula A/B, where A represents the percentage of the trader’s account they are willing to risk, and B is the current ATR value. This strategy allows traders to take into account the varying average sizes of price movements within different time frames, making it an essential tool in the trader’s arsenal.
What are the different ways to use ATR in trading?
ATR is not a one-trick pony. It offers a myriad of uses in trading. Traders can use ATR to:
ATR can also be combined with other indicators, such as Parabolic SAR for trend trading and Stochastics for range trading, to provide more comprehensive trading signals. Lastly, traders can utilize the ATR for exit conditional orders, such as stop loss and take profit, by providing optimal price points based on the asset’s volatility.
How does ATR differ from other volatility indicators?
While ATR might bear similarities to other volatility indicators, it has key differences that set it apart. ATR:
Some volatility measures may be inadequate during erratic price movements, such as limit moves in commodities, an issue ATR aims to solve. Furthermore, ATR is calculated using true range, which considers the actual high and low of the trading day as well as the previous closing price, making it more comprehensive than indicators using only daily high and low.
What is the significance of ATR in trend analysis?
When it comes to trend analysis, ATR plays a significant role. An increasing ATR value signifies that an asset is experiencing larger price movements, which may indicate a strengthening trend. On the other hand, a decrease in ATR suggests that an asset is undergoing smaller price movements, possibly indicating a weaker or sideways trend.
An increasing ATR alongside a price reversal signifies the strength of the trend, whether bullish or bearish, since ATR itself is not directional. Low and rising ATR levels may indicate a breakout from a trend or a continuation of the current trend.
How can traders use ATR for breakout strategies?
ATR is a valuable tool for breakout strategies. Traders can use the Average True Range (ATR) to predict potential breakouts by observing when price closes more than one ATR above the previous close, indicating a change in volatility and a possible upward breakout.
The ATR indicator can be applied to the closing price to set an entry point for a trade, where a position can be taken if the next day’s price trades above this value. To exit trades, signals can be generated by subtracting the ATR value from the close, thus indicating a significant market change and potentially closing a long position to mitigate risk.
Can ATR be applied to different timeframes?
The flexibility of ATR allows it to be applied to various timeframes. The Average True Range (ATR) indicator can be calculated over various time periods, such as:
This depends on the volatility analysis required. For short-term volatility assessments, a shorter ATR period such as 2 to 10 periods is recommended.
Longer ATR periods ranging from 20 to 50 can be used to gauge longer-term market volatility. The ATR can adapt to the trading range, expanding or contracting accordingly, which offers a dynamic approach to determining stop levels and protecting profits.
How To Use Average True Range To Pick Entry Price?
The Average True Range (ATR) plays an essential role in picking the entry price in trading. It does not produce direct entry or exit signals but is used to measure volatility, which can help traders make informed decisions about entry prices.
Higher ATR values indicate increased market volatility, suggesting that significant price movements could represent a strong trend, which might be factored into the decision for entry price. Traders may use the ATR to set stop-losses by multiplying the ATR value by a factor to determine a safe distance from the current price, which can also influence the entry price strategy.
How does ATR help in identifying potential reversals?
In trading, identifying potential reversals is key, and ATR can greatly assist in this task. When the ATR value increases, it suggests rising volatility which may indicate a potential trend change or market reversal. A decrease in the ATR value can imply decreasing volatility and could signal a consolidating or range-bound market.
An increase in the Average True Range (ATR) during a price reversal indicates a strong momentum behind the move. A prolonged period of low ATR values might suggest a consolidation area, potentially leading to a continuation of the current trend or a reversal.
What are some common misconceptions about ATR?
While ATR is a popular tool among traders, there are some common misconceptions about it. A common misconception is that it includes a strategy directing which way prices will likely move, when in reality, it only measures volatility and does not indicate price direction.
How can traders interpret changes in ATR levels?
Interpreting changes in ATR levels can provide traders with valuable insights. An increasing ATR value signifies that an asset is experiencing larger price movements, which may indicate a strengthening trend. On the other hand, a decrease in ATR suggests that an asset is undergoing smaller price movements, possibly indicating a weaker or sideways trend.
A high and rising ATR can be a sign of a strong uptrend or downtrend in the market. When the ATR is high but decreasing, it could signal a potential trend reversal or a period of consolidation.
What role does ATR play in risk management?
ATR plays a pivotal role in risk management. It helps to set stop-loss and take-profit levels that are adjusted to current market volatility, which improves the risk management aspect of trading. Using the ATR indicator, traders can create buffer zones to protect against normal market fluctuations, which is essential in managing trade risks.
ATR values guide traders in determining trailing stop distances, ensuring trades have room to develop while securing gains and managing potential losses. The indicator serves as a basis for adjusting trading position sizes in accordance with the prevailing market volatility, thereby aiding in risk control.
How does ATR factor into trading multiple assets?
ATR is a versatile tool that can factor into trading multiple assets. Traders may utilize ATR to compare the volatility of different assets, allowing them to assess the risk and potential reward associated with each asset.
What are the limitations of using ATR?
Despite its numerous benefits, using ATR also comes with certain limitations. The ATR indicator may not provide reliable signals to enter or exit the market.
The ATR indicator’s wave and peak movements may have low reliability in indicating the volatility of an asset.
How do traders integrate ATR into their trading systems?
Integrating ATR into their trading systems can significantly enhance traders’ performance. Traders use ATR to:
Incorporating ATR in trading systems involves calculating the ATR value and utilizing it to guide decisions on stop-loss and take-profit placements. Traders might employ ATR in conjunction with other indicators or analysis techniques to confirm trades and enhance decision-making.
Can ATR be used in conjunction with other indicators?
Yes, ATR can be used in conjunction with other indicators to enhance trading strategies. ATR Bands, which are calculated by adding or subtracting a multiple of ATR from a moving average, can be used alongside other technical indicators like the Relative Strength Index (RSI) to identify overbought or oversold conditions and confirm trading signals.
The ATR bands indicator is often combined with Bollinger Bands in the Bollinger Band squeeze strategy to anticipate potential price breakouts when volatility is low. ATR is used for setting exit conditional orders, such as stop loss and take profit, by providing optimal price points based on the asset’s volatility.
How does ATR adapt to different market conditions?
ATR’s adaptability to different market conditions makes it a versatile tool in a trader’s arsenal. ATR Bands are utilized by traders to discern key levels of support and resistance, which inform trading decisions as prices fluctuate. ATR Bands can indicate sell signals, aiding traders in recognizing the optimal moment to exit a trade.
Traders use ATR information to set stop-loss orders based on their risk tolerance, employing tools like the Chandelier Exit which employs multiples of ATR for this purpose.
What historical data does ATR rely on?
ATR relies on historical data to deliver insights into market volatility. ATR calculations rely on the true range data of an asset, which is derived from the maximum of the current high minus the current low and the current high or low to the previous close. After establishing the True Range for a set of time periods, the ATR is calculated by averaging these TR values over a chosen time frame, which is commonly 14 periods as initially suggested by J. Welles Wilder, the creator of the ATR indicator.
How frequently should traders update their ATR analysis?
Updating ATR analysis frequently is key to staying abreast of market volatility. ATR recalculates with each new trading session, incorporating the most recent period’s data. Traders may adjust the ATR indicator settings on their trading platforms to suit their specific strategies.
The ATR computation can be made more sensitive to recent volatility by reducing the number of periods considered. When using a different timeframe chart, the ATR calculation is automatically tailored to predict volatility within that specific session duration.
What are some practical examples of ATR in trading strategies?
In the practical realm of trading, ATR finds numerous applications. The ATR Bands Trading Strategy uses the Average True Range as a basis for creating bands that signal key levels of support and resistance, which are useful for making trading decisions on market trends.
Day traders can utilize ATR Bands to capture short-term price movements by identifying sell signals when prices reach the bands’ thresholds. ATR values are used to set stop-loss orders by utilizing tools like the Chandelier Exit, which adjusts stop-loss orders within average true range bands.
How do traders optimize ATR parameters for their strategies?
Optimizing ATR parameters for their strategies can significantly enhance a trader’s performance. Traders adjust the ‘n’ period in the ATR formula to match their trading strategy’s needs, where a higher ‘n’ results in a slower measure of volatility and a lower ‘n’ leads to a faster measure. Some traders apply a moving average over the ATR as a signal line to gauge entry points in trending markets.
To optimize ATR for position sizing, traders use smaller lot sizes for high volatility markets indicated by higher ATR values, and larger lot sizes for low volatility markets with lower ATR values. Traders often combine ATR with other indicators like the Parabolic SAR for setting stop losses in trending markets or with Stochastics in ranging markets to identify overbought and oversold signals.
What are some common pitfalls to avoid when using ATR?
While ATR offers a multitude of advantages, there are some common pitfalls that traders need to avoid. A common mistake when using ATR is to assume that volatility and trend always move in the same direction, which is not the case. Traders sometimes use stop losses that are too tight, which leads to being stopped out prematurely. It’s important to give trades enough room to accommodate daily market swings; otherwise, stop losses may not be effectively placed.
Using the ATR indicator to set a target profit requires combining it with market structure, not just relying on the ATR value alone. When markets move 2 times the ATR value or more within a day, they could be considered ‘exhausted’ and might reverse, but this should not be used in isolation without considering other factors like support and resistance.
What is the best ATR strategy for trading?
The best ATR strategy for trading depends on the individual trader’s style and the market conditions. Using the ATR to identify breakout opportunities is a highly regarded trading strategy, as breakouts often follow periods of low volatility indicated by lower ATR values. Combining the ATR with a signal line, such as a moving average, enables traders to confirm trends and identify aggressive buy or sell orders in the market.
Incorporate position sizing within ATR strategies to manage risk by adjusting lot sizes based on the volatility levels indicated by the ATR. The ATR is compatible with other indicators like the Parabolic SAR and Stochastics to set precise stop-loss orders and to identify trading ranges, respectively.
How do you trade Average True Range?
Trading with Average True Range (ATR) can be a game-changer for traders. ATR can be used for creating a complete trading system or as a component of a strategy to generate entry or exit signals. ATR is a measure of market volatility and helps in determining the periods of low and high volatility in price movements.
Traders can add the ATR value to the closing price to set a buy trigger, indicating a potential breakout if the next day’s price trades above that value. A common exit strategy using ATR involves subtracting the ATR value from the closing price and closing a position if the price falls below this level.
The chandelier exit is an ATR-based strategy that sets a trailing stop three times the 14-day ATR below each new high in an uptrend or above each new low in a downtrend. ATR is flexible and can be used across different trading time frames, including short-term day trading strategies.
What is the Average True Range ATR trailing stop strategy?
The Average True Range (ATR) trailing stop strategy is a powerful tool used by traders to set stop-loss levels based on the volatility of a stock, calculated from the current ATR value multiplied by a predetermined factor and adjusted from the stock’s closing price. Traders can customize the ATR Trailing Stop indicator according to their preferences and risk tolerance, including the trail type, ATR period, ATR factor, initial trade direction, and the type of average used.
An ATR trailing stop can be used in different ways to guide trading decisions:
What is the best ATR length?
The best ATR length varies based on the trading context and the asset being traded. The typical ATR length used in calculations is based on 14 periods, which could be in various timeframes such as:
To measure more recent volatility, a shorter ATR length consisting of 2 to 10 periods is recommended. For assessing longer-term volatility, using an ATR length of 20 to 50 periods is advised.
What is the best ATR for a stop loss?
The best ATR value for a stop loss is subjective and must be adjusted to each specific asset. A common practice suggests a multiplier of at least 1.5 ATR, with many traders using a value of 2 or 3 for time frames starting from H1.
The use of a multiplier with ATR for setting stop losses allows for a cushion that adjusts for market changes while maintaining a reasonable risk management strategy.
What is the best ATR multiplier setting?
The best ATR multiplier setting for stop-loss levels is subjective and must be adjusted to each specific asset. Common practice suggests a multiplier of at least 1.5 ATR, with many traders using a value of 2 or 3 for time frames starting from H1.
The use of a multiplier with ATR for setting stop losses allows for a cushion that adjusts for market changes while maintaining a reasonable risk management strategy.
What is a good ATR ratio?
A good ATR ratio is subjective and depends on the specific asset being traded and the market conditions. Using multiple ATRs for setting stop levels is a common practice, which can range from a fractional amount to up to three times the ATR value.
The versatility of ATR allows it to be used for different time frames including as a day trading strategy, by adding and subtracting ATR from the closing price of the first bar to determine entry and stop-loss levels for the day.
What is the average true range ATR bands?
ATR Bands are supplementary to the ATR Indicator, providing a visual representation of volatility by plotting a band around the ATR to signal uptrends, downtrends, or sideways movements. These bands consist of an upper and lower price range, calculated based on the ATR, and can serve as an alternative to Bollinger Bands.
The typical settings for ATR Bands use a default 5-day ATR period average with a shift represented by a default ATR multiple of 3.
What is a good ATR number?
A good ATR number can vary based on the trader’s strategy; a common period used for the ATR calculation is 14 days, but different timeframes can be employed to emphasize recent volatility or take a broader measurement.
A good ATR number can depend on the specific asset being traded and the market conditions, and thus there is no one-size-fits-all number for ATR that applies to all trading scenarios.
Summary
In conclusion, the Average True Range (ATR) is a powerful tool that provides traders with a measure of market volatility. From setting stop losses and determining position sizes to identifying market direction and potential reversals, ATR’s versatility makes it an indispensable part of any trader’s toolkit. While it has its limitations, such as not providing direct entry or exit signals, its benefits far outweigh them. By understanding how to read and interpret ATR values, traders can make more informed decisions and enhance their trading strategies.
(The article is partly written by AI. You find our best content (non-AI) on our website - Quantified Strategies)
Frequently Asked Questions
What is the Average True Range (ATR) in trading?
The Average True Range (ATR) is a measurement of market volatility based on the average price fluctuation of an asset over a specific period. It is commonly used as a tool in technical analysis for trading.
How does ATR measure market volatility?
ATR measures market volatility by calculating the full range of price movement for an asset within a specified period. This helps traders gauge the level of volatility in the market and make informed decisions.
Why is ATR important for traders?
ATR is important for traders because it measures market volatility, helping traders adjust their strategies to different market conditions.
How is ATR calculated?
To calculate the Average True Range (ATR), you need to first determine the True Range (TR) by selecting the largest value from the differences between the current high and the previous close, the current low and the previous close, and the current high and low.
Can ATR help in setting stop-loss levels?
Yes, ATR can help in setting stop-loss levels by providing a measure of market volatility, which is essential for determining the appropriate level for stop-loss orders.
