Historical Volatility measures the annualised standard deviation of past log price returns, giving traders a statistical benchmark for how volatile an asset has been. It is essential for options pricing and risk management in stocks and increasingly in crypto derivatives. Use our position size calculator to incorporate HV into your risk management workflow.
HV = Standard Deviation of [ln(Close today / Close yesterday)] over N periods × √252 (for daily data annualisation). Common periods are 10, 20, and 30 days. Higher HV means the asset's price has been swinging more dramatically; lower HV means calmer price action.
Bollinger Bands plot a moving average with upper and lower bands set at 2 standard deviations, expanding during high volatility and contracting during low volatility to create actionable squeeze and breakout signals. The Bollinger Squeeze is especially powerful when combined with <a href="/academy/indicators/keltner-channels" class="text-primary hover:underline">Keltner Channels</a> in the TTM Squeeze setup, a favourite of professional traders. Pair Bollinger Bands with the <a href="/academy/indicators/rsi" class="text-primary hover:underline">RSI</a> to filter false signals and confirm <a href="/guides/trade-breakouts" class="text-primary hover:underline">breakout entries</a>. Set them up on <a href="/tools/platforms/tradingview" class="text-primary hover:underline">TradingView</a> for real-time alerts and multi-timeframe analysis.
Chaikin Volatility measures the rate of change of the difference between high and low prices, providing a unique view of how the trading range is expanding or contracting. Unlike <a href="/academy/indicators/atr" class="text-primary hover:underline">ATR</a>, which smooths absolute range, Chaikin Volatility focuses on the acceleration of range changes. It is useful in <a href="/market/stocks" class="text-primary hover:underline">stock</a> and <a href="/market/forex" class="text-primary hover:underline">forex</a> markets and can be explored alongside other volatility tools in our <a href="/academy/indicators" class="text-primary hover:underline">indicator guide library</a>.
Donchian Channels plot the highest high and lowest low over a specified period, forming a simple but effective volatility envelope and breakout system that powered the legendary Turtle Trading strategy. They are widely used in <a href="/market/forex" class="text-primary hover:underline">forex</a> and <a href="/market/crypto" class="text-primary hover:underline">crypto</a> for trend-following breakout <a href="/strategies" class="text-primary hover:underline">strategies</a>. Compare Donchian Channels with <a href="/academy/indicators/bollinger-bands" class="text-primary hover:underline">Bollinger Bands</a> and <a href="/academy/indicators/keltner-channels" class="text-primary hover:underline">Keltner Channels</a> in our <a href="/academy/indicators" class="text-primary hover:underline">indicator guide library</a>.
ATR measures market volatility by calculating the average range of price bars over a specified period — it is essential for position sizing, stop-loss placement, and identifying volatility shifts. Use our <a href="/tools/calculators/position-size-calculator" class="text-primary hover:underline">position size calculator</a> to convert ATR readings into proper trade sizing instantly. Read the <a href="/guides/use-stop-loss-orders" class="text-primary hover:underline">stop-loss guide</a> and the <a href="/guides/calculate-position-size" class="text-primary hover:underline">position sizing guide</a> to master ATR-based risk management across every market. ATR adapts to any asset — apply it in <a href="/market/crypto" class="text-primary hover:underline">crypto</a>, <a href="/market/stocks" class="text-primary hover:underline">stocks</a>, and <a href="/market/forex" class="text-primary hover:underline">forex</a> for volatility-adjusted trading.