Volatility Indicators Guide: ATR, Bollinger Bands & Standard Deviation

OctaTrader platform offers three key volatility indicators essential for forex trading: Average True Range (ATR), Bollinger Bands, and Standard Deviation. ATR measures market volatility by calculating the average range between high and low prices, helping traders set appropriate stop-loss levels and position sizes. Bollinger Bands consist of a moving average with upper and lower bands based on standard deviation, indicating overbought/oversold conditions and potential breakout points. Standard Deviation quantifies price dispersion from the mean, with higher values signaling increased volatility. These tools are crucial for understanding market dynamics and timing entries/exits. Traders can combine these indicators to develop comprehensive volatility-based strategies, particularly useful during major economic releases or geopolitical events when forex pairs experience heightened price swings.