An advanced indicator measuring price extension from an EMA using Average Daily Range and Average True Range, helping traders assess current price positioning relative to a moving average.
Explore complementary indicator rolesHow it works
The indicator calculates two primary extensions: ADR Extension and ATR Extension by comparing the current price to a selected Exponential Moving Average (EMA). It determines how far the price has moved from the EMA in terms of Average Daily Range and Average True Range, providing a standardized measure of price movement.
Traders can customize the calculation by selecting different EMA lengths, choosing between close or high prices, and setting specific ADR and ATR periods. The results are displayed in a floating table on the chart, with visual indicators like a red line signaling when the price exceeds 4 ADRs above the selected EMA.
Why it may be useful
This indicator provides traders with a nuanced view of price movement beyond simple distance calculations by normalizing price extension using market volatility metrics like ADR and ATR. By converting raw price differences into standardized range measurements, traders can more objectively assess whether current price movement is significant or potentially overextended.
The flexible customization options allow traders to adapt the indicator to different market conditions, timeframes, and trading styles. This enables more precise analysis of price momentum and potential reversal points, helping traders make more informed decisions about entry, exit, and risk management.
When to explore it
The indicator is most effective in markets with clear trending characteristics and measurable volatility, such as forex, futures, and actively traded stocks. It works best when traders want to quantify price movement relative to recent market behavior, helping identify potential overbought or oversold conditions.
Traders should use this tool in conjunction with other technical analysis methods, particularly during periods of identifiable trend development or when assessing potential trend exhaustion. It is particularly useful for scalpers and day traders who need quick, objective assessments of price positioning within short-term market contexts.
Keep exploring
What we’ve verified
Access, alerts and repainting behaviour have not been independently verified for this indicator. Check the creator’s current publication and settings.
General descriptions and classifications are recovered research. Verified details above identify the specific checks we have completed. Check the creator’s current publication for later changes.
![ATR Extension [QuantVue] chart preview](https://s3.tradingview.com/j/JEew0HGJ.png?v=1690576748)
