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Technical analysis indicator
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ATR was originally developed for commodities but the indicator can also be used for stocks and indexes.
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The average true range is a moving average (generally 14-days) of the true ranges.
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Current ATR = [(Prior ATR x 13) + Current TR] / 14
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ATR is not a directional indicator, such as MACD or RSI. Instead, ATR is a unique volatility indicator that reflects the degree of interest or disinterest in a move.
ATR can be used to validate the enthusiasm behind a move or breakout.
A bullish reversal with an increase in ATR would show strong buying pressure and reinforce the reversal.
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Please visit www.nsedata.com for more details.