I’m reading up on ATR and want to use it to set stops possibly and help to review my entry. But I’m confused on how to read the data on Oanda’s platform.
So here’s a pic. I’ve got ATR included, it’s set at the default level of 14. What is this telling me exactly?
ATR is at 1.3726. It doesn’t make sense for that to be mean 1.3 pips or even 13 pips, so maybe it’s 137 pips of range, the daily average over the last 14 days? Am I moving the decimal point over two spots to get the number?
Yes, it’s 137 pips.
Actually, 137.26 pips, to be exact.
Recall that in yen-pair prices, the second decimal place (to the right of the decimal point) represents one pip, the first decimal place (to the right of the decimal point) represents tens of pips, and the first numeral to the left of the decimal point represents hundreds of pips.
The same pattern applies to the way the ATR is presented. In other words, the numeral 1 to the left of the decimal point represents 100 pips, the numeral 3 to the right of the decimal point represents 30 pips, etc.
I know it looks confusing, at first. But, you will get used to it
Ha, I WAS confused! Thanks for clearing that up! And I just looked at EURUSD to cover my bases, and as you said, the value follows exactly how you read the EURUSD pair price and pip changes. So an ATR value of 0.0060 is a 60 pip range.
Quick question Clint. How would I read an ATR of 0.856? Is it 85.6? If i check it against price and price is 84.894, then wouldn’t that make it 856? I’m confused too.
It looks like CAD/JPY, but on my charts CAD/JPY hasn’t been quite that high for over a year. Anyway …
The answer to your question is right in this thread (two posts before yours) —
In your case, ATR = 0.856 means ATR = 85.6 pips. The location of the decimal point tells the story.
The first digit to the right of the decimal point (in a yen-pair) represents tens of pips (in your case, that’s 80 pips), the second digit to the right of the decimal point represents single pips (in your case, that’s 5 pips), and the third digit to the right of the decimal point represents tenths of a pip (in your case, 6/10 of a pip). Put it all together, and you get 85.6 pips.
In yen-pairs, and in non-yen-pairs, align the decimal point in the ATR with the decimal point in the price, and it becomes obvious how to translate a decimal ATR into an ATR in pips.
Sorry to hijack thread, but on EUR/SEK, I get a daily ATR of 0.08897, so do I just ignore last pipette = 0.0889, then move decimal 2 places to right or 3? Would this apply to all 5 decimal place readings? Is there a simple rule, Eg, move decimal to right x times to get correct Pip move…cheers
