Channel Pullback Trading

The Channel for trading is one of the most reliable chart patterns. Many traders use this pattern for trading. The pattern is formed by two parallel support and resistance lines. It is also one of the easily identified patterns, which makes it ideal for beginners. This is the pattern most of your trading profits will come from.
Channel Pullback Trading
Ideal channels for trading
I will focus only on Ascending and Descending channels when trading. Horizontal channels are trickier to trade and are more often misinterpreted. I will now teach you the most profitable and least risky method of trading the channel:
The Pullback
This type of entry is designed especially for beginners at trading, as it provides a strong and objective entry point. The steps to trading it are the following:
1. After channel is identified, wait for its breakout – price breaking out of one
trend line.
Channel Pullback Trading
The break down: channel is identified and price breaks its Support trendline

3. Wait for trend to be confirmed (Confirmations of pullbacks).
Channel Pullback Trading
Price pulls back to the Support trendline
3. Wait for trend to be confirmed (Confirmations of pullbacks).
Channel Pullback Trading
Short trade is confirmed – candle is below the low of his previous candle
4. After trade is confirmed, calculate stop loss in the following way:
For short trades: Stop Loss is 1 pip above the highest high of 3 last candles.
For long trades: Stop Loss is 1 pip below the lowest low of 3 last candles.
Channel Pullback Trading
 Stop Loss is placed 1 pip above highest high
5. Calculate Take Profit: measure the channel size, and subtract this amount from the breakout place. Channel size is defined the distance between its Resistance trendline and its Support trendline. It is illustrated in the next chart.
Channel Pullback Trading
Target for breakout is measured
6. If the Take Profit divided by Stop Loss is less than 1.5, do not trade. This is called the Risk:Reward ratio.
7. Enter, set take profit.
Channel Pullback Trading
 Channel pullback trade result
More examples of trades:
Channel Pullback Trading
Short trade entered after pullback to the Support trendline

Channel Pullback Trading
Channel Trade Example

Channel Pullback Trading
Channel Trade Example

Channel Pullback Trading
Channel Pullback Trading
Channel Short trade

Channel Pullback Trading
Long trade on Ascending Channel

Channel Pullback Trading

Channel Pullback Trading
 Ascending Channel
The regression channel is a tool present on all trading platforms.
Below link for download SHI Channel MT4 indicator.
https://drive.google.com/drive/folders/0Bwjv2Pbf48itWDlMenl0SUtFU3c?usp=sharing

Related

Pattern Trading 6198185422585151927

Post a Comment

emo-but-icon

item