There are many technical indicators that help increase the odds of picking the right stock that will move higher after buying it. Our disciplined, rule-based stock trading strategy incorporates the most effective, yet simple of these technical indicators.
However, one frequently overlooked element of profitable stock trading is knowing how to pick the stocks with the highest volatility, and therefore the best odds of a larger gain when the stock rallies.
In order to do so, it is necessary to understand and use a technical indicator known as ATR (Average True Range), which basically indicates the level of day-to-day volatility for a stock (click here for a detailed definition and explanation of ATR).
If two stocks both have similarly bullish chart patterns, but you don’t know which one to buy, comparing the ATR of each stock will help make your decision easier because simply choosing the stock with the higher ATR may increase your percentage gain when the stock breaks out.
So, if you’re ready to learn how to maximize your stock trading profits through finding and trading high ATR stocks, check out the 5-minute trader education video below.
Press the “play” button, then click the bottom right corner of the video player window to view in full screen mode for best clarity:
If you would like to profit from trading the best stock picks with high ATR, be sure to sign up today for your risk-free subscription to The Wagner Daily, our flagship swing trading newsletter since 2002.