Indicator 03

Volatility Breakout

Larry Williams' classic: today's open plus a slice of yesterday's range marks the breakout.

Chart overlay · Intraday, 5m to 30m · Futures, liquid stocks and ETFs

Larry Williams' volatility breakout takes today's open and adds a slice of yesterday's range, typically half, to set a long trigger above and a short trigger below. The logic is that a move large enough to clear that distance early is unlikely to be noise, so the day has picked a direction.

What it shows

A long trigger above today's open and a short trigger below it, each a configurable fraction of yesterday's range.
Target and stop levels derived from the trigger, drawn for the current session.
First-break arrows, once per side per day.
A rolling 20-day table: how often each side triggered and how often the target printed before the stop.

How it reads the market

The volatility-breakout idea is simple: when price moves a meaningful fraction of yesterday's range away from the open, the day tends to keep going. Multipliers, targets and stops are all inputs, so you calibrate per instrument instead of trusting someone else's defaults.

Settings

Setting	Default	What it does
Trigger multiplier	0.5 x range	Fraction of yesterday's range that arms each side.
Target multiplier	1.0 x range	Distance from trigger to target.
Stop multiplier	0.5 x range	Distance from trigger to stop.
Stats window	20 days	How many completed days feed the results table.

Everything is an input: colors, thresholds and time windows adjust from the indicator's settings panel, no code needed.

Built-in alerts

Long trigger hit
Short trigger hit

Set them once from TradingView's alert dialog and get notified on your phone, no chart-watching required.

Comes with the membership

The whole indicator suite is included with the paid plan, $20/month or $200/year. Subscribe, submit your TradingView username, and the scripts land in your TradingView library.

Get full access

How to add it to your chart

Request access above with your TradingView username (one request covers the whole suite).
We grant it on TradingView, usually within 24 hours; TradingView notifies you.
On your chart, open Indicators → Invite-only scripts and add Volatility Breakout.

When to use it, and when not to

It earns its place when

You want an entry that fires early on trend days and stays out on quiet ones.
The instrument has a stable relationship between yesterday's range and today's move.
You are already trading a directional bias and want a trigger, not an opinion.

Leave it off the chart when

Yesterday was an outlier. A huge prior range sets a trigger so far away it never fills, or fills at the worst price.
You need a high win rate. This concept wins less than half the time and pays for it on the tails.
The market is in a tight multi-day coil. Every breakout inside a coil is a false one until the coil resolves.

Common questions

Who came up with the volatility breakout?

Larry Williams popularised it in the 1980s as a way to trade commodities with a single number and no screen time. The idea long predates the indicator; what he added was the discipline of scaling the trigger to yesterday's range rather than using a fixed distance.

What multiplier of yesterday's range should I use?

Half is the classic. Lower fires more often and catches more noise. Higher fires rarely and only on real trend days. The right number depends on the instrument, which is why it is an input rather than a constant.

How is this different from an opening range breakout?

The opening range builds its trigger from today's first minutes. This builds it from yesterday's whole session. That means the trigger exists before the bell, and it does not need the first fifteen minutes to compute.

Does it work on stocks or only futures?

It was designed for futures and still fits them best, because they gap less. On single stocks an overnight gap can put price past the trigger before the open, which is a fill you never get.