ATR VTL - VertexFX Client Side Indicator

[edakad 10]

ATR VTLS is a VertexFX client side VTL indicator. It is similar to the Average True Range Indicator (ATR), but it splits the true range of a bar into bullish and bearish ranges. The bullish range is calculated by taking the difference between high and open of the bar. Bearish range is calculated as the difference between open and low of a bar. Then it calculates the bullish and bearish Average True Range and plots the bullish ATR as green line and bearish ATR as red line. ATR is a measure of underlying volatility in the market. Bullish ATR line shows the volatility of upward price moves and Bearish ATR line shows the volatility of downward price moves.

 

ATR is used to place stop loss and take profit levels. When volatility is higher, wider stop loss and take profit must be used. However the ATR VTLS indicator splits the volatility into bullish and bearish volatility. Thus the trader gets a better understanding of the volatility conditions for upward and downward price moves and improve the stop loss and take profit levels further. When a buy trade is opened and bullish volatility is higher than bearish volatility, trader can place comparatively large take profit level than the stop loss level. Similarly when the bearish volatility is higher than bullish volatility, for a buy trade, comparatively larger stop loss should be used. With ATR VTLS indicator, trader can avoid such low risk reward ratio trades.

 

The indicator can be customized through the parameters. ATR period determines the range to calculate the bullish and bearish ATR. With "show Bull" and "show Bear" parameters, the display of bullish and bearish ATR can be switched on or off. To change parameters, open the VTL script in VTL editor by double clicking the indicator name and modify the parameters located at the top of the script. Save, compile and attach the indicator again to chart for the modified parameters to take effect.

 

atr_vtl_indicator.txt