Intraday trading with ATR points (ATR Trailing Stops)
Share Market options are very logical. But most of the time we don't realise this. ATR Trailing stop indicators are useful in trading options. ATR trailing stops are different from all other indicators and can be used to easily understand day trade (intraday trade).
If you use Zerodha or upstox, Select Nifty 50 Chart -> select Studies -> search ATR Trailing Stops & select Change Plot Type -> Squarewave -> givenPeriod-21 & Multiplier 3 -> Click Done.
How to calculate ATR points? After 3.30p.m. or after share market is closed, Calculation can be done using today's closing price and ATR closing price (Today’s closing price - ATR points). It will help us to trade on the next day. Take ATR points 1min, 5min, 10min, 15min, 30 min & 1hr. Most of the time Nifty will reach till 1hr. Sometimes it will reach 2hrs also. So we have to calculate till 2hrs.
If we calculate, we will know the range nifty will go through & what point it will reach next. (i.e.) If 10 min value is reached & it crosses that value, the points will reach 80% of the next point. So we can buy when we get signal for buying and with ATR, we can find a convenient point for selling by realising if it will reach this point or not.
In my trading page, I have selected candle Heiken Ashi, ATR Trailing Stops Indicators. In the chart page, you can see the above mentioned ATR on 7/1/2022. In the chart, ATR value is 17690 and the closing price is 17816. But in 30 min chart, the closing price is 17820. So we have to calculate for both closing price of the day and 30 min closing price.
I will show you how to calculate ATR value and it will work for the next day.
30min -> 17816-17690 = 126
17816 + 126 = 17942, (if close price higher than ATR , add closing price)
17690 -126 = 17564( if ATR smaller than closing price, subtract ATR price)
15 min-> 17884-17820 = 64
17884 + 64 =17948
17820 - 64 = 17756
ATR calculation are perfect for day traders. It is useful for the entire day.
If you use Zerodha or upstox, Select Nifty 50 Chart -> select Studies -> search ATR Trailing Stops & select Change Plot Type -> Squarewave -> givenPeriod-21 & Multiplier 3 -> Click Done.
How to calculate ATR points? After 3.30p.m. or after share market is closed, Calculation can be done using today's closing price and ATR closing price (Today’s closing price - ATR points). It will help us to trade on the next day. Take ATR points 1min, 5min, 10min, 15min, 30 min & 1hr. Most of the time Nifty will reach till 1hr. Sometimes it will reach 2hrs also. So we have to calculate till 2hrs.
If we calculate, we will know the range nifty will go through & what point it will reach next. (i.e.) If 10 min value is reached & it crosses that value, the points will reach 80% of the next point. So we can buy when we get signal for buying and with ATR, we can find a convenient point for selling by realising if it will reach this point or not.
In my trading page, I have selected candle Heiken Ashi, ATR Trailing Stops Indicators. In the chart page, you can see the above mentioned ATR on 7/1/2022. In the chart, ATR value is 17690 and the closing price is 17816. But in 30 min chart, the closing price is 17820. So we have to calculate for both closing price of the day and 30 min closing price.
I will show you how to calculate ATR value and it will work for the next day.
30min -> 17816-17690 = 126
17816 + 126 = 17942, (if close price higher than ATR , add closing price)
17690 -126 = 17564( if ATR smaller than closing price, subtract ATR price)
15 min-> 17884-17820 = 64
17884 + 64 =17948
17820 - 64 = 17756
ATR calculation are perfect for day traders. It is useful for the entire day.