When I look at the ATR on the AUD/JPY it read(14) 0.4918. how do you determine what the pip value is?
Hello olivetree,
You’ve waited a long time for a reply to your question – sorry about that 
The short answer
The ATR(14) metric you asked about – 0.4918 – is a PRICE DIFFERENCE in yen. It is the average difference between the HIGH’s and the LOW’s of the most recent 14 time periods on the chart you are looking at.
It is ¥0.4918 – or you could write it as 0.4918 JPY.
It can also be expressed as 49.18 pips.
How do we know the correct way to convert a price in yen to a PRICE in pips?
For that we need the long answer.
The long answer
By definition, one pip is 1/10,000 of a unit of currency, for all currencies EXCEPT the yen.
For the yen, one pip is defined as 1/100 of a unit of currency.
The reason for the difference is the tiny value of one yen. Notice that all the major currencies EXCEPT the yen are roughly similar in value. The CAD, AUD, and NZD are all worth ABOUT $0.75 each, plus or minus a few cents. And the EUR, GBP, and CHF are each worth somewhere between $1.00 and $1.30.
But, the JPY is worth about one cent, that is, ÂĄ1 = $0.01 approximately.
Because the JPY is worth about 1/100 of the value of the other major currencies, one JPY pip is defined to be about 100 times the size of the “other” pips.
So, when we look at a NON-YEN price, say for instance the price of USD/CAD, we get a number that looks like this: USD/CAD = 1.30769, in which the digit 6 represents 6 pips, because its position in the price is 1/10,000 of the price. The digit 9, then, represents 9/10 of a pip.
On the other hand, when we look at a YEN price, say for instance the AUD/JPY in your post, we get a number that looks like this: AUD/JPY = 78.384, in which the digit 8 represents 8 pips, because its position in the price is 1/100 of the price. The digit 4, then, represents 4/10 of a pip.
Now that we know that a yen-price takes the form xx.x1x, where the 1 in this example represents 1 pip, we can apply the same pattern to the ATR figure you asked about.
Your ATR figure – 0.4918 – fits the pattern this way: xx.x9xx, where the digit 9 represents 9 pips. Therefore, the digit 4 must represent 40 pips, and the digits 1 and 8 must represent 1/10 and 8/100 of a pip, respectively.
So, ATR(14) = 0.4918 means that the average PIP RANGE over the past 14 time periods (on this particular chart) was 49.18 pips.
You didn’t identify the time-frame you are using, but it’s pretty clear that it is the daily chart.
Therefore, your ATR(14) figure is telling you that –
– over the past 14 days, the AVERAGE DAILY RANGE of the AUD/JPY has been 49.18 pips/day
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