Donchian Channel is a system that can assist foreign exchange trader to determine market price movements in different situations. If we understand how to trade correctly Donchian Channel indicator MT4, we can improve our profits. Donchian Channel Indicator MT4 made by Richard Donchian, this indicator is used by most experienced Forex traders.
Donchian channel has two bands on the bottom and top. The lower band reflects the lowest low and the upper bands reflects the highest high of n bars. The zone between the upper and the lower band is the channel. This indicator is usually available on Metatrader 4 and Metatrader 5. The upper and lower band identifying the price channel. This indicator is a great technical indicator for determining the volatility of price action. Like a bollinger bands indicator Donchian channel will be wider if price active and will be narrow if price is quiet.
Donchian channel indicator trading signals
Open sell position if a market price moves under n periods low and you can open buy position if a market price moves above n periods high.
Donchian channel indicator is usually traded as a breakout technical indicator, this indicator show support and resistance. The lower band reflects the support level and the upper band reflects the resistance level. If you like support and resistance, maybe this indicator can help you in every trading activity.
Can this indicator be used as a reversal indicator ? Yes, you can use this indicator to identify a reversal signal. Donchian channel indicator can be a great technical indicator when the market trend is established.
You can download and use this indicator for free.
Donchian channel MT4 indicator download
Those signals are very efficient that you don’t actually need an interpretation at all just to understand what those are all about. Through the use of indicators you will know if the pair is oversold or overbought.
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