SPY ATR Signal

Good evening.  Could the SPY be triggering an ATR sell signal this week?  Today was a rough trading day, with the SPY losing about 2.35% of its value.  Any more negative days this week and the ATR sell signal may occur.

The average true range is a volatility indicator. Volatility measures the strength of the price action, and is often overlooked for clues on market direction. A better known volatility indicator is Bollinger bands. In “Bollinger on Bollinger Bands” (2002), John Bollinger writes that “high volatility begets low, and low volatility begets high.”

This chart was created using a free software from Ninja Trader.  I learned about this software from a post at The Kirk Report.

We will have to take a wait-and-see approach.  I am interested to see what tomorrow morning’s futues look like, especially with Spain’s debt issues, BP’s oil leak, and stocks having the worst selloff in months today.

For now…good night.