ATR on one-minute charts as a live check against the spread
Posted: Sat Oct 31, 2026 7:48 pm
The usual advice on ATR is about setting stops. For scalpers, a more useful job is deciding whether to trade at all.
Take the one-minute ATR over the last 14 or 20 bars. Compare it with the current spread. If the average one-minute range is 3 pips and the spread is 0.3, there's room. If the range is 1 pip and the spread is 0.8, there isn't.
A ratio of ATR to spread can be displayed directly on the chart. Many scalpers set a minimum, say 5 or 8, below which no new trades are taken.
The beauty is that it adapts. When the market wakes up, the ratio rises and trading resumes. When it dies, the filter shuts things off without any clock-based rules.
One caution: ATR lags. A sudden burst takes a few bars to show up, and a sudden calm takes a few bars to fade. For fast filters, use a shorter period or compare against a very recent range.
What minimum ATR to spread ratio would you accept?
Take the one-minute ATR over the last 14 or 20 bars. Compare it with the current spread. If the average one-minute range is 3 pips and the spread is 0.3, there's room. If the range is 1 pip and the spread is 0.8, there isn't.
A ratio of ATR to spread can be displayed directly on the chart. Many scalpers set a minimum, say 5 or 8, below which no new trades are taken.
The beauty is that it adapts. When the market wakes up, the ratio rises and trading resumes. When it dies, the filter shuts things off without any clock-based rules.
One caution: ATR lags. A sudden burst takes a few bars to show up, and a sudden calm takes a few bars to fade. For fast filters, use a shorter period or compare against a very recent range.
What minimum ATR to spread ratio would you accept?