Wide range days occur when a stock’s high and low prices diverge much further than on a typical day.
Extremely divergent days can help predict major trend reversals.
Average True Range (ATR) allows you to compare trading ranges over several days.
Meanwhile, the volatility ratio can be used to identify wide range days with a technical indicator that automates the process of finding wide range days.
Wide range days usually occur when the volatility factor exceeds 2.0 over a 14-day period.