Trading in the channel.

The price of a currency pair on Forex never moves in a straight line; it either rises or rolls back down again, forming new lows and highs.

It is thanks to the specifics of trend movement that it becomes possible to create a price channel that will be used to formulate a Forex strategy.

Trading in a channel allows you to immediately get a more complete picture of the market and assess the places of likely price reversals.

In the classic version, the channel is built based on the minimum and maximum points, the support line is built on the basis of the minimums, and the maximums act as the basis for the resistance line. These two lines are the boundaries of the price channel.

Nowadays, few traders build channels manually using the technical tools of the trading terminal. It's much easier to use a trend channel indicator or another similar tool, which you can select in the indicators .

The result is a ready-made channel whose width varies depending on the time frame and settings entered. After that, you can begin trading within the channel.

This type of trading is quite simple, the main thing is to be able to build a more or less clear channel.

Trading is carried out according to the following rules:

• Determine the direction of the trend - it is clearly visible by how the support and resistance lines .

• Buy - uptrend, reversal at the support line.

• Sell - downtrend, price reversal at the resistance line.

• Breakout of one of the channel boundaries - wait until the price moves at least 20 points, then open a trade in the direction of the breakout.

When using price channel trading, it is a good idea to track the events that caused a particular movement; this can be done by installing a news indicator .