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ATR(1) would simply be the true range for one day. I fail to see the value
of taking an "n" day moving average of one day. I am looking for the
average true range of price over "x" period of days....what is the average
price movement for the past 10, 50 day period. If, as is the case for WMT,
the 10 day ATR is 2 2/16, and the 50 day ATR is 2 7/16, after price has
moved, during the trading day, 2 points, I would anticipate little reward
to buy the stock as I could only presume a futhur movement of 2-7
sixteenths. If however, the stock fell 2 1/2 points, I have a low risk
entry point for a countertrend trade. If I owned the stock from a lower
price point, after the 10/50 day ATR is reached I have a good exit point
for my day trade.
Al Taglavore
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> From: Bob Jagow <bjagow@xxxxxxx>
> To: metastock@xxxxxxxxxxxxx
> Subject: RE: atr
> Date: Thursday, July 13, 2000 8:28 PM
>
> Right. The Equis ATR(period) matches Wilder's original version and the TR
> isn't a builtin.
> ATR(1) is actually the TR so taking its ma will give SMA or EMA
versions
> of ATR -- Chande uses the SMA for stops.
>
> Bob
>
> -----Original Message-----
> From: owner-metastock@xxxxxxxxxxxxx
> [mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of Mike Campbell
> Sent: Thursday, July 13, 2000 2:18 PM
> To: metastock@xxxxxxxxxxxxx
> Subject: Re: atr
>
>
> Al Taglavore writes:
>
> > Neither. As Welles Wilder developed it, a moving average was not used.
> > MetaStock has it programmed. Simply pull up the indicator and type in
the
> > number of days. Today's ATR is the distance from today's low to
today's
> > high OR from yesterdays close to today's high.....whichever is greater.
> > This accounts for any gaps from the previous close to the low of the
> > current day.
>
> I believe you are mistaken there. What you described is the "true
> range" calcuation. ATR is some moving average of THOSE values.
>
> Otherwise, what would the "number of days" have to do with it?
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