Looking for Volatility Opportunities
Each unique futures market will oscillate from periods of high volatility to low volatility and back again, and high or low levels of volatility can occur for short or long periods of time. When volatility for a symbol dries up, a trader can wait for volatility to return, or they can be agile and shift their trading to a more active market. To find volatility opportunities in the futures markets, traders need to find a way to normalize volatility across all futures symbols. It is not just about the price movement, traders must also take into consideration the point value for each unique futures market.

NTTBangfortheBuck
This is an open source NinjaScript indicator that you can import into the NinjaTrader desktop platform. This indicator can be used on any futures symbol at any bar interval to measure the volatility potential in dollars for a future symbol. But more importantly you can also use this indicator in the NinjaTrader Market Analyzer which is a real-time quote board that allows you to apply historical indicators at any bar interval. This allows you to sort and rank all the future symbols so you can quickly identify those symbols that have the highest dollar volatility potential. Of course, there's no guarantee that these higher volatility potential symbols will be any more profitable than any other symbol that you might trade, and these higher volatility symbols may also come with potentially greater risk.

Charting: Here in the chart the NTTBangForTheBuck indicator is applied to a 3-minute chart. The indicator plots the 34-bar ATR average dollar volatility potential as a dark orange line, and plots that same value as a histogram for each price bar individually (1-bar ATR). Traders can adjust the parameters and change the ATR look back or change the bar interval in the indicator settings as needed. Try setting the chart bar interval to daily or weekly to measure the potential dollar volatility for longer term trades.

Here in the Market Analyzer, the NTTBangForTheBuck indicator appears as a column next to the symbol. The number displayed for each symbol represents a normalized dollar volatility value for each symbol for a three-minute bar.

This indicator is provided by the NinjaTrader education team and is for demonstration and educational purposes only. Any questions or feedback can be directed to [email protected].