Hi guys,
For those intraday traders that trade on the lower time frames (5 min and below) or anyone with input on the matter, what kind of metrics do you guys use to measure market volatility.
For example, i generally just eyeball it. If the grids on my charts are in increments of less than 5 pips (for a 5 min chart) i figure its a low volatility market. But that's not always the truth because that could just be the current range of the market is all that's being displayed on my screen big moves are just off screen. I also look to see what kind of news is coming out for the given instrument. Sometimes market slows down prior to big news and gets volatile afterwards.
I was considering testing something like a ratio of Average Daily Range to the ATR of price from the days open to current time. How else does anyone who measures this stuff actually measure it?
For those intraday traders that trade on the lower time frames (5 min and below) or anyone with input on the matter, what kind of metrics do you guys use to measure market volatility.
For example, i generally just eyeball it. If the grids on my charts are in increments of less than 5 pips (for a 5 min chart) i figure its a low volatility market. But that's not always the truth because that could just be the current range of the market is all that's being displayed on my screen big moves are just off screen. I also look to see what kind of news is coming out for the given instrument. Sometimes market slows down prior to big news and gets volatile afterwards.
I was considering testing something like a ratio of Average Daily Range to the ATR of price from the days open to current time. How else does anyone who measures this stuff actually measure it?