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Volatility is a measure of price fluctuations which takes frequency and range of price changes into account.

A higher volatility means that price moves up and down rapidly over short time periods. A lower volatility means that price almost never changes or changes insignificantly.

Volatility can be measured by calculating the annualized standard deviation of daily change in price. Besides, to measure volatility, traders use different indicators. One of the most famous indicators which measures volatility is the Average True Range (ATR) indicator.

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