Investor Education Story

Financial Indicator

Macroaxis News
  
By Nathan Young

October 30, 2017

There are many indicators and tools out there and the average true range is one of the more popular. The average true range or ATR for short, is measuring the range of a particular set of data. Normalized Average True Range is trying to normalize the data and give you a consistent stream of information to base your decisions off of.

Normalized Average True Range

Instead of getting hung up on the normalized portion of this tool, focus on the average true range and understand what that is about. The Normalized portion is just an addition to the equation on how the data is calculated. Average true range is helping in looking at the volatility of a market rather than price. Volatility is important for those who are using options in their portfolios because you want to get a good premium in a more volatile market than one that is flat.




This particular indicator sits at the bottom of the chart and moves based on the market. You can adjust the inputs to tweak the information to your particular market timing and if you are looking long term of short term. Testing is an important aspect of any indicator and should be taken seriously. MacroAxis has many tools and research help that can point you in the right direction. Using the ATR is popular and information can be found readily.

About Contributor

Nathan Young
   Nathan Young is a Senior Member of Macroaxs Editorial Board - US Equity Analysis. With years of experience in the financial sector, Nathan brings a diverse base of knowledge. Specifically, he has in-depth understanding of application of technical and fundamental analysis across different equity instruments. Utilizing SEC filings and technical indicators, Nathan provides a reputable analysis of companies trading in the United States. View Profile
This story should be regarded as informational only and should not be considered as solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Nathan Young do not own shares of FILTER. Please refer to our Terms of Use for any information regarding our disclosure principles.

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