How do you determine the volatility of a pair? low,med or high | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Indicator to determine Swing high/low for Fibonacci Trading? 1 reply

If you use a breakout model, how do you determine your TP and SL? 9 replies

Whats your favorite Low Volatility pair? 5 replies

How Do You Measure Volatility For Any Currency Pair? Is there Any Website/Indicator? 1 reply

How do you determine High, Low, Close 2 replies

Attachments: How do you determine the volatility of a pair? low,med or high
Exit Attachments

How do you determine the volatility of a pair? low,med or high

  • #1
  • First Post: Feb 13, 2009 9:11pm Feb 13, 2009 9:11pm
what are the indicators? how do you measure it? I tend to have more success in low to medium volatility and then i get stopped out because of high vol. I do not like high vol, wild swings. hundreds of pips in minutes, etc. i do not want to trade during that time.

please help. thanks.
  • #2
  • Feb 13, 2009 9:13pm Feb 13, 2009 9:13pm
i use ATR for that.
  • #3
  • Feb 13, 2009 9:16pm Feb 13, 2009 9:16pm
Quoting tdion
i use ATR for that.
i heard about it, but how do you use it exactly? i see the pips moving up and down but how to determine whether it is low, med or high.
  • #4
  • Feb 13, 2009 9:37pm Feb 13, 2009 9:37pm
ATR is "Average True Range" ... It's a formula, Google it and you'll find it. Most of us don't need the formula, we just use the indicator.
  • #5
  • Feb 13, 2009 9:38pm Feb 13, 2009 9:38pm
you need to look up the definition of ATR on stockcharts.com
  • #6
  • Feb 13, 2009 9:56pm Feb 13, 2009 9:56pm
Quoting sed34
i heard about it, but how do you use it exactly? i see the pips moving up and down but how to determine whether it is low, med or high.
Scroll for a few screens and spot the maximum ATR value (depending on the time frame) for a given period (could be for example a month for daily, a week for h4, a day for 1h, etc...), as well as the minimum value.

Add them and divide per 2.
You'll then have the low, med and high values for that given period, and you can add the respective levels to your indicator so to see them on the chart and be able to evaluate where and how at a certain moment the volatility is.

Maybe there's already an indicator that would do the calculations, if I find it I'll post it here.
  • #7
  • Feb 13, 2009 10:05pm Feb 13, 2009 10:05pm
Quoting doblece
Scroll for a few screens and spot the maximum ATR value (depending on the time frame) for a given period (could be for example a month for daily, a week for h4, a day for 1h, etc...), as well as the minimum value.

Add them and divide per 2.
You'll then have the low, med and high values for that given period, and you can add the respective levels to your indicator so to see them on the chart and be able to evaluate where and how at a certain moment the volatility is.

Maybe there's already an indicator that would do the calculations, if I find...
thank you!! finally an answer. I will try that out. watch you pm
  • #8
  • Feb 13, 2009 10:58pm Feb 13, 2009 10:58pm
About 1 1/2 year ago the ATR for the EUR/USD was in the 50s and 60s........ today it's over 200, and back in novemebr of 2008 the ATR got as high as the 350s........ Now that is volitility.
Same Whore .... Different Dress
  • #9
  • Feb 13, 2009 11:06pm Feb 13, 2009 11:06pm
i could have looked up the definition, spoon fed it to you just like this clown did.

buy why shouldn't you have to look it up just like me and everyone else?

whatev.

Quoting sed34
thank you!! finally an answer. I will try that out. watch you pm
  • #10
  • Feb 13, 2009 11:16pm Feb 13, 2009 11:16pm
Quoting tdion
i could have looked up the definition, spoon fed it to you just like this clown did.

buy why shouldn't you have to look it up just like me and everyone else?

whatev.
A procedure is not a definition... and teamwork doesn't care about who is holding the spoon... as long as things are finally understood.

Now, how did you know that I love to hear other people's laughter?
  • #11
  • Feb 13, 2009 11:20pm Feb 13, 2009 11:20pm
Quoting johnedoe
About 1 1/2 year ago the ATR for the EUR/USD was in the 50s and 60s........ today it's over 200, and back in novemebr of 2008 the ATR got as high as the 350s........ Now that is volitility.
so, basicaly:

Quoting doblece
Scroll for a few screens....you can add the respective levels to your indicator so to see them on the chart and be able to evaluate where and how at a certain moment the volatility is.
.
and depending on your system & methods - you decide what levels for your system you would consider as low (too low), what is high and the rest;

when situation in the market or your methods will change - readjust the levels
  • #12
  • Feb 13, 2009 11:20pm Feb 13, 2009 11:20pm
see how far the herd mentality of "teamwork" gets you.
  • #13
  • Feb 13, 2009 11:26pm Feb 13, 2009 11:26pm
(h+l)/2 doesn't provide a time-weighted average. If price spends only a day at a very low low, and only a day at a very high high, but most of it's time elsewhere... you're not getting a very good result.

There's an actual formula for ATR, it's not just bar size. Google it. Do your homework.

I use average ATRs, a 100 period avg, a 50 period avg and a 10 period avg, along with the last 3 periods individually. This tells me whether volatility is increasing, at what rate, and what the current ATR is.
  • #14
  • Feb 13, 2009 11:36pm Feb 13, 2009 11:36pm
Quoting tdion
see how far the herd mentality of "teamwork" gets you.
Only as far as I wish and it satisfies me to get to (don't you like "going places"?)

Wrong though about the "herd"... I usually countertrend, in trading as well as my personal life.

And so to come back on topic and maybe help someone else (and don't forget the dessert!) , I'll post my reply to the PM.


Average true range depends on the TF.

It is a calculation (the complicated stuff is here:
http://stockcharts.com/school/doku.p...e_true_range_a
) which gives the width in pips of the average range of that TF (how much pips it has moved from hig to low).

So, on Daily charts, you should consider several days (you can use a week, but better would be a month) to see the fluctuation and have an approximate mid-range which BTW will show on the indicator as the more common range (that mid-range also can "range", that is, for example on daily, you could have a mid-range between 80 and 100). Two candles wouldn't be enough, IMO, because you could be taking a particular high volatility day while the average real range is much lower. That's why you will take in consideration longer periods.

I don't know exactly why you are asking, but if it is for stops, usually 2x or 3x ATR is safe. On the other hand, if it is to measure good and volatile periods compared to slow markets, you could check on the chart and on the indicator and determine above which level is the one you would use for more volatile sessions, or if needing slow ranging markets, below which level would it be safe to trade.

If you tell me exactly what you want to do with the info maybe I can help further.

Regards
Caroline

  • #15
  • Feb 14, 2009 12:00am Feb 14, 2009 12:00am
Quoting tdion
i could have looked up the definition, spoon fed it to you just like this clown did.

buy why shouldn't you have to look it up just like me and everyone else?

whatev.
i looked at the definition. but i need to know how to go from theory and numbers into practice. how to apply it.
  • #16
  • Feb 14, 2009 12:01am Feb 14, 2009 12:01am
Quoting Rabid
(h+l)/2 doesn't provide a time-weighted average. If price spends only a day at a very low low, and only a day at a very high high, but most of it's time elsewhere... you're not getting a very good result.

There's an actual formula for ATR, it's not just bar size. Google it. Do your homework.

I use average ATRs, a 100 period avg, a 50 period avg and a 10 period avg, along with the last 3 periods individually. This tells me whether volatility is increasing, at what rate, and what the current ATR is.
thanks for the tip
  • #17
  • Feb 14, 2009 12:08am Feb 14, 2009 12:08am
i like discussion : )))


high=High[i];
low =Low[i];
TempBuffer[i]=high-low;

prevclose=Close[i+1];

TempBuffer[i]=MathMax(high,prevclose)-MathMin(low,prevclose);

AtrBuffer[i]=iMAOnArray....




well, anyway - not exacly range, but close
atr1 (actual, histo) + smoozing ma (14(line)) = a.k.a. atr(14) (line)
stock atr- in every mt4
Attached Image (click to enlarge)
Click to Enlarge Name: atr range.gif Size: 24 KB
Attached File(s)
File Type: mq4 ATR_x3LHist_mtf.mq4   3 KB | 456 downloads
File Type: mq4 Range_v1Osc.mq4   3 KB | 427 downloads
  • #18
  • Feb 14, 2009 12:31am Feb 14, 2009 12:31am
btw. Doblece, what about that clown?
seriously...
  • #19
  • Feb 14, 2009 12:46am Feb 14, 2009 12:46am
notice that i was the first person to "help" on this thread... i was the one to introduce ATR into discussion.

i wanted the guy to look up the information for himself, so that he can figure out how to get it to work for him. that's what i did when i saw ATR in a discussion on volatility severalm months ago.

maybe my work ethic is different than everyone elses around here.

Quoting cobraforex
I'm not sure what gives you the right to call a helping person a "clown".

Have you ever in your 3 years member ship heard about rule #1?

Why didn't you use your time to answer the question like you "could have done" like you say instead of insulting the one who did.

Did you have a bad time lately?

If so, I feel sorry for you and if there is something that I can do to help you let me know.
  • #20
  • Feb 14, 2009 1:35am Feb 14, 2009 1:35am
Quoting tdion
i wanted the guy to look up the information for himself, so that he can figure out how to get it to work for him. that's what i did when i saw ATR in a discussion on volatility severalm months ago.

maybe my work ethic is different than everyone elses around here.
Your work ethics is completely understood and even more, shared.
However, in this particular case, I answered sed34 like I did because:

1) I perceived that his question went beyond the simple acquisition of the formula or definition (and he confirmed this with his post #15)

2) sed34 has been working hard at the THV thread and in general trying to find his own "voice" as a trader so, for me, he's not "just another newbie" but someone I have communicated with many times, trying to find solutions together, thus I saw the question as a "continuation" of what we've been working on. I probably wouldn't have answered in such detail (though I would most probably have posted the link to stockcharts anyway) if he was a total stranger to me.

3) I've been through most of the "newbies confusion" and got out by myself and thus know that sometimes it can be a hard and lonely job. Time is my best valuable asset and I think it should be for everyone. For that reason, if the slightest of my own short experience can help someone get to the point faster than I did, you can bet that I'll be there.

4) I could be wrong. You could be right. Maybe we both are?

I am sorry if I stepped on your toes... and of my silly answers to you but I am not accustomed to be called names from a complete stranger.
It was fun, though... sort of.


Quoting fxxx
btw. Doblece, what about that clown?
seriously...
Clowning is a serious job.
Ask Patch Adams...
0 traders viewing now