Daily

 

The Complete Stock Resources Site For The Intelligent Investor

 

  
Adam & Eve Tops
Anticipating  A Selloff
Andrews Pitch Fork
Bid-Ask
Bilateral Trade Setups
Bollinger Bands
Bottoms
Breakouts
Breakout Trading
Canslim
ClearAir
Comp. Relative Strength
Cup With Handle
Cutting Loses
Daily Range
Declines
Exit Strategies
Exploring Market Physics
Dow and Elliot Waves
False Breakouts and Whipsaws
Flags and Pennants
5 Fibonacci Tricks
Finding Stocks
Fun With Fibonacci
Gaps
Greed and Fear
Highs
Low Down On Bottoms
Market Timing
Head and Shoulders
Hell's Triangle
Momentum Cycles
Momentum Trading
Morning Gap Strategies
Moving Average Crossovers
Overbought/Oversold
Pattern Failure
Pitfalls Of Selling Short
Playing Failed Patterns
Point and Figure
Pull Back Day Trading
Risk/Reward
Reversals
Selling Declines
Stochastics
Scanning Tips
Stage Analysis
Surviving Bear Markets
The Big W
Tale Of The Tape
Tape Reading
Time Trading
The Gap Primer
Tops
Trailing Stops
Trading Execution Zone
Triangle Trading
Trend Waves
Trend Direction and Timing
Trends
The Profitable Trader
Uncharted Territory
Williams %R
Wedges and Volume
20 Golden Rules
20 Rules For Trade Execution
20 Rules To Stop Losing Money
5 Wave Decline
3-D Trade Execution
Voodoo Trading

Google
 
Web www.thetstockmarketwizard.com

 

HOMECANDLESTICKSGECKO'S PICKSWATCH LISTARTICLESFOREXJOIN USLINKS

Daily Range

 

Tracking the daily range of any tradable gives a sense of the enthusiasm of buyers and sellers, the variety of valuation beliefs, and helps to identify reasonable price projections based on the volatility that the tradable has exhibited in the past.  Daily range is the difference between the high and low in one trading day.  An increase in daily range invites speculation as to the reasons behind the increase and contributes to forecasts of what is possible near term.  It is an important input into the valuation forecasts of options and other derivative products in the form of volatility measures.

One indicator developed to track the range in daily prices for a tradable is the Average True Range.  This indicator was developed by J Welles Wilder and is defined to be the greatest of the following for each period:

 

 The distance from today's high to today's low.         
  The distance from yesterday's close to today's high.
The distance from yesterday's close to today's low.

 
Average True Range can help identify price projections given both the trend of the indicator and trend in price.  If the security being charted has a high correlation to the major indices and supporting evidence of a reversal of the trend is present, Average True Range can help to identify possible initial price projections for a security in a short term trade.