Stop loss - ATR-based

An ATR-based stop places the stop a fixed multiple of ATR away from the entry price. The stop distance widens with volatility and tightens in calm markets, automatically.

Shape

"stop_loss": {
  "type": "atr",
  "multiplier": 1.5,
  "indicator": "atr"
}

Params

• multiplier - how many ATRs of distance. Default 1.5.
• indicator - name of the ATR indicator in your strategy (you must declare it). Default atr.

Stop price

• Long: entry - ATR * multiplier
• Short: entry + ATR * multiplier

Usage

The most-used stop type. Pairs naturally with ATR and risk-based sizing.

Pitfalls

• Multiplier choice is symbol-dependent. 1.5x ATR on BTC may be reasonable; on a low-volatility equity it may be a 0.5% stop that gets ground out by spread.
• ATR includes recent noise. A single news spike inflates ATR for many bars, which widens stops and shrinks position size.