ATR Threshold Histogram for Classifying Volatility Levels

Summary

This indicator classifies Average True Range readings relative to lower and upper thresholds. It displays a histogram with one color for ATR values below the lower level, another for values above the upper level, and a third for readings between the thresholds. The document presents it as a way to see whether measured volatility is comparatively low, high, or within a chosen band.

Thresholds can be entered in points or set as percentages based on the minimum and maximum ATR values over a specified bar range. Inputs include the ATR period, both threshold levels, the calculation mode, the choice between point and percentage units, and the lookback range used for percentage calculations. The text describes the indicator's settings and display, but gives no example chart, trading rules, or backtest. Threshold classifications are therefore descriptive; the document does not show that they predict price moves or improve a strategy.

Key ideas

• The indicator compares ATR with lower and upper thresholds.
• ATR readings below, above, or between the thresholds receive distinct histogram colors.
• Thresholds may use fixed points or percentages of the ATR range over a chosen lookback.
• The description provides no evidence that these classifications produce trading gains.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.