What is a Donchian Channel?

What is a Donchian Channel: A technical analysis indicator that consists of three lines helping to indicate the underlying trend, potential breakout levels, and potential reversals.

Category: Technical analysis indicator

How is a Donchian Channel Used: Outer lines are often used to denote support and resistance within the context of a trend. These lines can be used to trade breakouts or reversals within a trend.

What Does a Donchian Channel Consist of: A Donchian Channel consists of three lines: an upper line that represents the highest price over the past N periods, a lower line that represents the lowest price over the past N periods, and a middle line representing an average of the two other lines.

What Does a Donchian Channel Look Like:

Chart of a Donchian Channel
Chart of a Donchian Channel – Source: TheTechnicals.com and TradingView

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