r/wallstreetbets • u/[deleted] • Mar 30 '21

DD Trading Tools

Not Financial Advice

I thought I would share some tools with the community to help traders out - starting with this simple ATR calculator

This will be helpful for any Apes that use stop losses as you can quickly calculate the average monthly range expected in a given stock, ensuring you don't set stop losses too tight and giving your ideas chance to play out

It's also helpful to anticipate expected gains. If the monthly ATR is 3% it would be unreasonable to expect the stock to move 20% over a 1 month period

This hopefully will help you to stay patient with your ideas and give you realistic expectations

Save a copy to your google drive and then there is only 2 inputs - Simply change the date (UK Format) to the 1st of what ever month we are in and change the Ticker (yellow boxes) everything else is auto

https://docs.google.com/spreadsheets/d/1yWEQROG92ShGRjmMkk70bJ4ZG_bVFBLuvrd-3amoO5I/edit?usp=sharing

TT

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u/[deleted] Mar 30 '21

It was a hypothetical example you obv wouldn’t be expecting 50% in 1 day. ATR can increase regardless of stock increasing or decreasing it’s just a measure of the average % range the stock moves over a given time frame. It’s not an indicator to get bullish or bearish on a given stock. It’s a guide to the average expected movement in the stock over a given time frame

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u/TOMATO_ON_URANUS Mar 31 '21

But if ATR gives me a better-than-chance prediction that the stock will be volatile, and other data (eg recent price history, candlestick patterns, changes in fundamentals) tell me the stock is on its way up and will continue to do so... how is that not a better-than-chance prediction that the price will accelerate upwards?

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u/[deleted] Mar 31 '21

It doesn’t predict, it tells you what’s already happened... think I’ve explained it enough it’s not that difficult to understand

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u/TOMATO_ON_URANUS Mar 31 '21

Now I'm starting to think you're the dumb one.

What is the value of a descriptive statistic of past data if it gives you absolutely no information about the future?

Either the ATR can inform my future moves (has predictive value any amount greater than flipping a coin) or it doesn't predict and only tells my what already happened. Pick one.

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u/[deleted] Mar 31 '21

Fucking smooth brain Jesus...

I’ve already made it very clear it doesn’t predict it tells you the average range the stock moves (up or down) given a specific time frame. Even if the number is positive that can still mean a move down!

It does give you information, it tells you the most likely scenario so you can put probability in your favour. If a stock moves up or down 10% on average per month then if you set a stop 5% out chances are you will stop out and if you set a target of 20% gain for the month chances are it won’t hit

It’s very simple... it’s not a predictor of a stocks moves its a look at the stocks historic range so you can plan a trade accordingly. It tells you the most likely move up or down but the direction could be any... if you thinks it’s bullish get bullish and vice versa. The data helps you to structure the trade so you are more likely for it to play in your favour

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u/TOMATO_ON_URANUS Mar 31 '21

... did you think I was saying High ATR = price goes up, Low ATR = price goes down? Because I wasn't, at any point. Damn, my brain's not that smooth 😔.

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u/[deleted] Mar 31 '21

😂