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.

At the moment, it is rare for traders to build channels manually using the technical tools of a trading terminal; it is much easier to use a trend channel indicator . Or another similar tool that you can select in the indicators .

As a result, you get a ready-made channel, the width of which varies depending on the time frame and the entered settings, after which you can start trading directly in the channel.

This type of trading is quite simple, the main thing is that you can 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 - downward trend, price reversal at the resistance line.

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

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