Then you draw a trend line. You can now copy this trend line and move it parallel to the original trend line so the the complete price action of the trend is between these two trend line. In case of an upward trend you have now produced a trend channel which you can use to anticipate the position of the next swing low of the upward trend. And after the upward trend continued you can estimate where the next upward swing could end.
This zone can be used as a good exit area. In an upward trend you can use the correction the small downward trend against the main upward trend to draw a wedge or flag. As soon as the wedge or flag is broken to the upside then you can initiate a buy trade. As mentioned above you can use the upper boundary of the trend channel of the main upward trend to pinpoint good exit price levels.
My trading career started in Since I have helped thousands of traders to take their trading to the next level. Many of them are now constantly profitable traders. The following performance was achieved by me while trading live in front of hundreds of my clients :. Connect With Me:. Sometimes there are several price channels with one timeframe.
This happens due to the fact that the price has changed drastically in one timeframe for a certain period, thus forming incoherent extremums. After installing the AutoChannels indicator, the channel will be displayed as two parallel lines of the same color from its beginning to the current price. Each channel has a marker next to it indicating that it belongs to a certain timeframe.
Clicking on the marker displays the channel's projection perspectives and its middle line. Please keep in mind that the middle of the channel will not always be in its center, since the High and Low prices selected by the algorithm might not be equidistant from each other. For better visualization, the boundaries of the channels have different thickness depending on the timeframe they were drawn in. For instance, the boundary of the H1 channel will be thicker than the one of the channels drawn in the M Channels are also often used in wave based strategies analysis.
Bounce trading involves predicting the price movement within the channel. Thus, when the price bounces off the boundary bottom — we buy, and when the price tests the upper boundary — we sell. As for setting up the Stop Loss, it must be hidden behind price action channel boundaries. And the Take Profit has to be set to the previous High or Low, depending on the channel ascending or descending or to the predicted channel boundary on the opposite side. In most cases, the price corrects itself tilting towards the breakout boundary, and bounces off it, making a retest.
This is the moment to make the deal in the direction of the breakout, regardless of the price action channel — either ascending or descending. It is also essential to remember that the price channel drawn in a higher timeframe is more important than the channels drawn in lower timeframes.
Accordingly, the probability of a price rebound from the channel boundary in higher timeframes, both inward and outward after the breakout will be higher. Minimum history for channel formation bars — sets the minimum history depth in bars required for a channel formation. Channel formation algorithm — how accurately price extremes will be taken into account.
If you have any difficulties while installing the indicator, please view the detailed instruction. The indicator automatically detects the channel boundaries with the moving price and displays them on the chart. How to Install. Product Info. System Requirements. Product Categories.
Indicators 22 Sentiment 9 Signal 6 Utilities 7. All-In-One Free. The indicator automatically draws important Pivot Points using the most popular methods: Classical Floor , Camarilla, Woodie and Fibonacci. OrderBook Pro.
Open trades and pending orders of retail traders are displayed as a two-sided histogram.
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