ATR (Average True Range) measures the average size of an instrument’s price movement over a set number of recent periods (commonly 14), regardless of direction. It says nothing about whether price is going up or down - only how much it has typically been moving - which makes it a pure volatility measurement, often used to size a stop-loss or position sensibly relative to an instrument’s normal, current volatility.
Related Reading
See how it’s used for stop-loss sizing in ATR (Average True Range) Explained.