Please I’m a forex learner and I was learning about ATR and I came across ATR which gave a figure 0.00215 and says the market has been moving 22 pips can you please explain to me why it says that…thank you
0.00215 is actually 21.5 pips
The statement you quoted simply rounded it to 22 pips.
ATR is stated just like the price of the pair it refers to. In non-yen pairs, that means the fourth decimal place represents individual pips, the third decimal place represents tens of pips, etc.
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Alright thanks a lot I appreciate…What about when it reads again 0.00382 I’m I correct to says it’s moving 38.2 pips?
0.00382 means ATR = 38.2 pips
That’s not quite the same thing as saying “it moved 38.2 pips”. ATR is a mathematical average, not a record of any one particular price move.
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Please can you teach me how to calculate the moving pips anytime the ATR provides a figure?..Thanks a lot
It doesn’t work that way.
If you know the pip-ranges (high minus low) for x-number of time periods, you can calculate the ATR(x) by adding up those pip-ranges and dividing the sum by x.
But, you can’t do the calculation in the reverse order. That is, if you know the ATR for a particular pair in a particular time-frame, you can’t calculate the pip-ranges that generated that average.
Let’s say the ATR(10) on the DAILY time-frame was 81.6 pips. That’s the average daily pip-range for the previous 10 days. Given that information, how could you possibly figure out the pip-range for yesterday, or the day before yesterday, or last Monday? You can’t.
Alright…please take me through time frames the important things/Signals to look out for in order to open a Trade…thanks for all your time and explanation I truly appreciate it 