ATR (smoothed)

SMA of ATR — a smoother volatility baseline.

ATR (smoothed), sometimes written ATR-SMA, is just a simple moving average applied on top of the Average True Range. Raw ATR already smooths volatility with a Wilder average, but on noisy intraday data it can still jump around; taking an SMA of it produces a calmer reference line.

The usual workflow is comparison: plot raw ATR against its smoothed version and read the relationship. Raw ATR rising above the smoothed line means volatility is expanding (ranges are widening), while raw ATR falling below it means volatility is contracting (the market is coiling). Many breakout systems only arm when volatility is expanding, and many mean-reversion systems prefer the opposite.

Because it is two averages deep, ATR (smoothed) lags more than raw ATR. It answers 'is volatility unusual right now?' rather than giving the tightest possible stop distance.

ATR_SMA = SMA( ATR(atr_period), sma_period )

Leggi la definizione completa di ATR (smoothed) nel glossario →