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Trading glossary

What is ATR (Average True Range)?

IndicatorsIntermediate

ATR measures market volatility by calculating the average range between high and low prices over a set period. It doesn't indicate direction, only how much a stock typically moves. Traders use ATR to set appropriate stop losses — a common rule is placing stops 1.5-2x ATR from entry.

Related terms: Volatility Stop Loss Position Size

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