FRACTAL AI AGENT Docs ← Terminal

Volatility Regime + Sizing PRO

Know the volatility weather, and size for it.

Volatility Regime measures how aggressively price is moving now, explains what that environment favors, and converts your account size and risk percentage into a position-sizing guide.

What this tool is for

Use it before choosing size, stop distance or strategy. The same setup behaves differently in a quiet market and an extreme-volatility market: quiet conditions can compress before a breakout, while turbulent conditions produce larger swings, more slippage and more stop-outs.

In plain trading language

Market conditionWhat it usually means for a trader
Low volatilityA squeeze or consolidation: price is moving less than usual. A breakout may be building, but it has not happened yet.
Medium volatilityNormal trading conditions for this market. Standard structure-based stops and size are generally easier to manage.
High volatilityAn expansion phase: wider candles, faster moves and larger pullbacks. Reduce size and allow a structure-based stop more room.
Extreme volatilityAn unusually unstable market. Gaps, slippage and sharp reversals are more likely; consider waiting or using much less exposure.

The regime score is the current 14-period ATR as a percentile of this chart's own loaded history. In other words, it measures whether the current range is quiet or large for this instrument and timeframe, rather than comparing it with a different market.

How to read the result

OutputWhat it means
Regime & scoreLow, medium, high or extreme volatility, based on the current 14-period ATR percentile versus its own history.
Expected rangeAn estimate of the distance price may normally cover in the current environment.
Breakout likelihoodWhether present conditions are relatively supportive of expansion.
Continuation / reversionWhich behavior the current regime appears to favor: moves persisting or snapping back.
Risk amountThe account value placed at risk from the account size and risk percentage supplied to the tool.
Position size & warningA sizing guide plus any leverage caution for the current volatility.
Recommended approachHow to adapt—for example, reduce size, widen a structure-based stop or wait for volatility to settle.

Practical workflow

  1. Enter an accurate account size and the maximum percentage you are willing to lose if the stop is hit.
  2. Run the tool on the same symbol and timeframe as the planned trade.
  3. Set the stop from market structure, then use the risk amount to calculate size.
  4. Reduce exposure in high or extreme regimes; do not compensate for a wide stop with excessive leverage.
  5. Re-run after a volatility shock because the regime can change quickly.
Simple principle: position size should usually move opposite to volatility. When price swings become larger, use fewer units so the amount at risk stays controlled.
Pair it with: GARCH Bands to see the volatility envelope on the chart and Hurst to distinguish trending from mean-reverting behavior.
Sizing is an estimate: spreads, slippage, contract specifications, fees and gaps can change the actual loss. Confirm the final size with your broker or exchange calculator.