Average True Range Technical Analysis and ATR Signals

Developed by J. Welles Wilder

This bitcoin indicator is a measure of volatility - it measures the range of btcusd price movement for a specific btcusd price period. The ATR is a directionless indicator & it does not determine the direction of the trend.

High ATR values

High Average True Range indicator values indicated market bottoms after a sell off.

Low ATR values

Low Average True Range values showed extended periods of sideways btcusd price movement- Price Range, such as those found at market tops and consolidation periods. Low ATR values are typical for the periods of sideways movement of long duration which happen at the top of the bitcoin market and during consolidation.

Calculation

This bitcoin indicator is calculated using the following:

• Difference between the current high & the current low

• Difference between previous closing btcusd price & the current high

• Difference between previous closing btcusd price and the current low

The final Average is calculated by adding these values & calculating the average.

Technical Analysis and Generating Signals

Average True Range indicator can be analyzed using the same principles as other volatility indicators.

Possible bitcoin trend change signal - The higher the value of the indicator, the higher the probability of a bitcoin trend change;

Measure of bitcoin trend momentum - The lower the indicator’s value, the weaker the bitcoin trend movement.

Analysis in BTCUSD Trading