Smart Start TA Series 41: Understanding the Average True Range (ATR) for Volatility Measurement

In Smart Start TA Series 29: Mastering the Volume Profile Indicator for Trading, we discussed how volume plays a crucial role in identifying market sentiment. Similarly, volatility is a key factor that traders must consider, and the Average True Range (ATR) is one of the best indicators for measuring it. ATR calculates the average movement of an asset over a set period, without indicating the direction of the trend. This is critical when trading volatile assets like $BTC (Bitcoin) and $ETH (Ethereum), as it helps set more effective stop-loss levels and manage risk better.