Does efficiency mean that there is no disagreement about fair value ? Does efficiency mean that all market participants are thinking the same exact thing ? I'm not arguing, probably asking an academic question. Jack Hershey, please do not respond to this post, as my head will explode from it and I need it at the moment.
Prices fluctuate because new factors come to impinge on future perception of that price. If all factors are known and price is stable, it means the market has achieved 100% efficiency. So price is always trying to seek that efficient point. An algo that drives price can bully price by killing the solvency of existing participants. Thus price is driven into a inefficient zone to force the pseudo solvent individuals to enter or exit at these points. The algo being the counterparty to their trades.
So when prices shoot above or below ATR, Algo is driving price to the point that it recruits as many participants that it can then it does a 180, the recruits are left buying at the high end of ATR and selling at low end of ATR, before price heads to the other end of ATR. If price truely breaks out of ATR it's again driving prices to force counter parties to take the other side of the trade but this time it doesn't let the counterparties to exit by keeping price in a new ATR. Time and trends eventually force counterparties to exit in the new ATR at a loss. It's zero sum.