Trading the channel is very much profitable in the forex industry. Professional traders use the “Channel Trading System” to trade in the direction of the trend. A channel is very much similar to that of a trend line. It contains two parallel lines with at least three connecting points. Some traders tend to draw ascending and descending trading channel by forcing the point to join with the parallel trend line. It’s imperative that every single point is joined smoothly while drawing the channel. Since we are taking about advanced channel trading strategy we will be taking our trade entry in the direction the trade in the third time. In order to draw the valid channel, we will use “two connecting points” so that we can trade the third point in the market.
The Professional trader uses the channels resistance for selling the pair and buys at the channel support. In the above figure a nice “descending channel” is drawn in the EURJPY pair. Traders wait patiently for the price to reach the channel resistance for the third time. After the price hit the channel resistance for the third time, traders wait for price action confirmation signal to enter the market. A nice “bearish pin bar” is formed at the above channel resistance which triggers the short entry of the traders. For More Information About Invest In Forex Visit: Price Action
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11/21/2023 12:05:09 am
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