Use ATR to Spot Breakouts & Volatility Shifts: Level Up Your Trading With This Chart Indicator

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It measures volatility — not direction — and can signal when markets are likely to break out or consolidate.In a recent live webinar, John Rowland, CMT, demonstrated how to find and apply ATR using Barchart tools. Here are some highlights from his breakdown.Elon Musk Warns ‘The Government is Basically Unfixable’ Says He Hasn’t ‘Been to D.C. Since May’A $106 Billion Reason to Buy Google Stock NowGameStop Stock is Moving Higher as its Free Cash Flow Grows StrongerOur exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today!Start from any stock, ETF, or futures page - e.g., Palantir (PLTR).Click the “Technical Analysis” menu on the left.www.barchart.comView multiple ATRs (9-day, 14-day, 20-day, 50-day).www.barchart.comDay traders often use shorter ATRs (9-day).Swing traders typically look at 14- or 20-day time frames.Long-term investors may focus on the 50- or 100-day ATR.This overview also gives a quick visual snapshot of whether volatility is rising or contracting, which can hint at upcoming consolidations or expansions.To add ATR to your stock or ETF chart, open Indicators > Standalone Studies → Average True Range.Default is 14-period, but settings can be adjusted.ATR can also be smoothed with moving averages.www.barchart.comIn John’s example of the S&P 500 ($SPX), ATR was decreasing — signaling that volatility was coming out of the market, which often precedes a breakout.Position Sizing → Traders use ATR to set stop losses relative to volatility.Breakout Signals → Falling or low ATR can mean volatility is about to expand.Market Context → Rising ATR = high volatility environment; contracting ATR = quieter market.Use Interactive Charts to customize ATR and overlay it with other indicators.Check Technical Analysis on futures/equity pages for quick ATR values.Combine ATR with the Earnings Calendar to anticipate where volatility may spike.ATR doesn’t predict direction, but it’s one of the best ways to measure whether a market is heating up or cooling off. For day traders, swing traders, and long-term investors alike, it’s an essential tool to keep on watch.Watch this quick breakdown:Catch the full webinar replay with John Rowland on ATR, and sign up for email notifications so you don’t miss our next live trading webinar. On the date of publication, Barchart Insights did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P Futures6,670.25 +2.75 (+0.04%)Dow Futures46,122.00 +3.00 (+0.01%)Nasdaq Futures24,536.00 +13.75 (+0.06%)Russell 2000 Futures2,422.80 +2.50 (+0.10%)VIX16.36 +0.67 (+4.27%)Gold3,727.50 +2.40 (+0.06%)PortfolioSign in to access your portfolioSign inTop gainersWBTN WEBTOON Entertainment Inc. 20.80 +5.84 (+39.04%)QMMM QMMM Holdings Limited 88.00 +16.25 (+22.65%)BBAI BigBear.ai Holdings, Inc. 5.94 +0.85 (+16.70%)PAGS PagSeguro Digital Ltd. 10.74 +1.04 (+10.72%)PBF PBF Energy Inc. 30.62 +2.70 (+9.67%)Top losersNXTT Next Technology Holding Inc. 23.72 -5.08 (-17.64%)GEMI Gemini Space Station, Inc. 28.13 -4.39 (-13.50%)RKLB Rocket Lab Corporation 47.25 -6.80 (-12.57%)ORLA Orla Mining Ltd. 11.51 -1.27 (-9.94%)CCJ Cameco Corporation 80.23 -6.09 (-7.06%)Most activeOPEN Opendoor Technologies Inc. 8.92 -0.57 (-6.06%)BBAI BigBear.ai Holdings, Inc. 5.94 +0.85 (+16.70%)SNAP Snap Inc. 7.74 +0.28 (+3.75%)NIO NIO Inc. 7.02 +0.53 (+8.17%)NVDA NVIDIA Corporation 174.88 -2.87 (-1.61%)Earnings eventsMy earnings eventsEarnings eventsTrending tickersNIO NIO Inc. 7.02 +0.53 (+8.17%)RIVN Rivian Automotive, Inc. 14.32 +0.72 (+5.29%)OXY Occidental Petroleum Corporation 47.76 +2.29 (+5.04%)BBAI BigBear.ai Holdings, Inc. 5.94 +0.85 (+16.70%)NFE New Fortress Energy Inc. 2.0000 +0.6200 (+44.93%)Top economic events