ATR, for Average True Range, refers to a technical analysis indicator that measures the volatility of an asset’s or security’s price action.

The ATR formula is “[(Prior ATR x(n-1)) + Current TR]/n” where TR = max [(high − low), abs(high − previous close), abs(low – previous close)].

By default, the ATR is calculated on a 14 periods.

In *Omega Ω*, the ATR is used as an Risk-Management tool ally.

### ATR Length #

The *ATR length* is the period on which the calculation is done.

By default, it’s 14 period.

You can increase the length to have a longer period of calculation to have a more accurate average.

You can decrease the length to have a shorter period of calculation to have the latest average.

We recommend you to let it as default.

### SL ATR multiplier #

The *SL ATR multiplier*, or Stop Loss Average True Range Multiplier, is a variable involved in the quantity size for a same R/R ratio.

The higher the number, the lower the quantity size for same R/R.

The lower the number, the higher the quantity size for same R/R.

### R/R ratio #

This is the ratio known as Risk/Reward.

Risk-reward ratio is a formula used to measure the expected gains of a given investment against the risk of loss.

The higher the R/R, the higher the return for 1$ of order size.

### Risk % for ATR #

On a *% Capital Risk*, you choose for a *Risk Equity %*.

This *Risk Equity %* is what you are willing to lose on a position, known as position size (quantity).

The *Risk % for ATR* is the maximum percent of the position size you’re risking using ATR.

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