ATR (Average True Range)

ATR (Average True Range) is a number that tells you how much a stock's price typically bounces around day-to-day. It measures volatility—the size of price swings—by looking at the largest move (up or down) over the past 14 days on average. You'll see ATR mentioned by traders watching charts, because it helps them set stop-losses (exit points if a trade goes wrong) and understand how risky a stock is. A stock with an ATR of $2 moves around less than one with an ATR of $5. Higher ATR means bigger, wilder price swings; lower ATR means calmer, steadier movement. It's useful when deciding how much price movement to expect before getting worried about your investment.