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.
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.
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.
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.
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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