What is ATR, which is originally scheduled for a heaven-and-earth dis‑sign up update? Explanation of its meaning and how to use it
The sky and Earth's design de-saiingu is a knowledge hub that each update I look forward to!
In the Sky and Earth's design update, an indicator called ATR is planned to be added.
What is ATR in the first place?
Before the Sky and Earth's update, I want to know what ATR is like...
Like with ABUADX and ABUDMI, I originally didn’t even know that ADX or DMI existed.
For those who are curious, in this article I mostly write for myself, but before the Sky and Earth's design updateMT4 ATRI researched and will share!
What is ATR in the planned Sky and Earth's design update? Explanation of meaning and how to use
Regarding the ATR for the Sky and Earth’s design, since the manual hasn’t arrived yet, I don’t know the fine details well, but
the meaning and usage of ATR in MT4
are as follows.
Image (MT4 ATR) and origin
The blue line below is ATR. (It came default in MT4)
By default it’s set to 14, which means it’s calculated over the past 14 candlesticks.
In practice, ABUATR ishistogram-likeapparently.
※ We use ABUATR instead of a histogram.ABUATR is still histogram-likeso there is no change to chart layout, so please rest assured.
Quoted from the Abu-san X Post
Meaning
ATR (Average True Range) is an indicator that in Japanese is called“Average True Range”.
To put it simply…
- Rising ATR = high volatility
- Falling ATR = low volatility
ATR calculates the average of “price movement range” and visually shows it.
In other words,
ATR answers the question, “How much has this currency pair been moving recently?”
In FX, larger price movement (high volatility) means more opportunities.
When ATR peaks and then drops, it becomes a trend reversal point.
Therefore, by looking at ATR, you can
- “Today seems to be a day with movement.”
- “The market is quiet right now.”
to anticipate in advance.
How to use
As a usage method,to gauge market overheatingtherefore
it helps in trading based on volatility.
In practice,
- When ATR is rising, it’s overheated, so avoid trading
- When ATR is falling, there is stability, so trade
and other approaches as well,risk avoidanceas a method.
For example, if ATR on a daily chart is 100 pips, then take profit once you’ve gained 100 pips
as a pattern to decide on taking profit or cutting losses to avoid risk.
【Forecast】 What is ABUATR in Sky and Earth’s design?
Regarding ABUATR created by Abu-san, I don’t know every detail, but
It functions as a powerful filter even without MTF
from Abu-san’s remarks,
ABUATR alone can recognize the environment (MTF)as a独自の indicator
I speculate that it might be
an independent indicator that can recognize the market environment using ABUATR alone.
Hearing that you might be able to bypass environmental recognition with an indicator in Sky and Earth’s design made me the happiest news of the year.
Because it’s Abu-san, I think they will carefully incorporate the usage of ABUATR and DSATEA settings into the manual.
I trade fully automatically, but if such a highly capable indicator/EA becomes available
I feel a day when I can trade with the same level of advantage as Abu-san with full automation is not far off.
That day doesn’t seem impossible.