Volatility Stop

Trails a stop a multiple of the Average True Range behind the closing price, so the stop only ratchets in the trade's favor: it rises (never falls) below price in an uptrend and falls (never rises) above price in a downtrend. A close beyond the stop flips it to the other side of the price — the stop switches from acting as support to acting as resistance (or back), signaling a trend change rather than mere noise.

Live Demo

Pick a market regime to see how Volatility Stop(5) reacts:

Usage

import {VolatilityStop} from 'trading-signals';
 
// VolatilityStop yields results once 5 inputs have been added
const volatilityStop = new VolatilityStop();