Single-period True Range estimate
True Range (Latest)
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True Range (Single Period)
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2x ATR Stop Distance
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When Should You Use This?
Use the ATR to set volatility-adjusted stop-losses and position sizes. ATR adapts to each stock's unique volatility — a $500 stock and a $20 stock need very different stop distances.
How It Works
1
Enter OHLC Data
Input the current period's High and Low, plus the previous period's Close.
2
Set Period
The default ATR period is 14, which works well for most timeframes. Shorter periods (7) react faster, longer (21) are smoother.
3
Use for Stops
A common approach is to place your stop-loss 1.5-3x ATR away from your entry price. This gives the stock room to breathe.
Frequently Asked Questions
ATR (Average True Range) measures the average daily price range over a given number of periods. It captures volatility including gaps, unlike simple high-low range.
True Range is the greatest of: (High - Low), |High - Previous Close|, or |Low - Previous Close|. ATR is the average of True Range over N periods.
Multiply ATR by 1.5-3x and subtract from your entry price for a long position. This creates a volatility-adjusted stop that adapts to the stock's behavior.
1.5x ATR is tight (more stops triggered), 2x is standard, 3x is wide (fewer stops but larger losses). Trend followers often use 2-3x ATR.
No. ATR only measures volatility (how much price moves), not direction (which way it moves). Use trend indicators alongside ATR.