## Time for action – calculating the Average True Range

To calculate the ATR, perform the following steps:

1. The ATR is based on the low and high price of `N` days, usually the last 20 days.

```N = 5
h = h[-N:]
l = l[-N:]```
2. We also need to know the close price of the previous day:

`previousclose = c[-N -1: -1]`

For each day, we calculate the following:

The daily range—the difference between the high and low price:

```h – l
```

The difference between the high and previous close:

```h – previousclose
```

The difference between the previous close and the low price:

```previousclose – l
```
3. The `max()` function returns the maximum of an array. Based on those three values, we calculate the so-called true range, which is the maximum of these values. We are now interested in the element-wise maxima across arrays—meaning the maxima of the first elements in the arrays, the second elements in the arrays, and so on. Use the NumPy `maximum()` function instead of the `max()` function for this purpose:

`truerange = np.maximum(h - l, h - previousclose...`