Average True Range (ATR) and Average True Range Percent (ATRP) in-2025
What Is the Average True Range (ATR)? The Average True Range (ATR) is a volatility indicator that was created by J. Welles Wilder. Wilder created ATR with commodities and daily prices in mind, as he did with the most of his indicators. Compared to equities, commodities are sometimes more volatile. They frequently experience gaps and limit moves, which happen when a commodity opens up or closes below the session's maximum permitted change. The volatility of gap or limit moves would not be captured by a volatility model that solely relies on the high-low range. In order to account for this "missing" volatility, Wilder developed the Average True Range. It is important to remember that ATR doesn't indicate price direction, just volatility.In his 1978 book, New Concepts in Technical Trading Systems, Wilder discusses ATR. The Directional Movement Concept (ADX), RSI, and Parabolic SAR are also included in this book. Wilder's indications have endured and are still widely used even though they were created before the computer era. True…
