Average True Range (ATR)
A measure of volatility introduced by Welles Wilder in his book: "New Concepts in Technical Trading Systems."
The True Range indicator is the greatest of the following:
Current high less the current low.
The absolute value of the current high less the previous close.
The absolute value of the current low less the previous close.
The Average True Range is a moving average (generally 14days) of the True Ranges.
Wilder originally developed the ATR for commodities but the indicator can also be used for Forex. Simply put, a currency experiencing a high level of volatility will have a higher.
