Keltner Channel (MetaTrader forex indicator) — is a classical technical analysis forex indicator developed by Chester W. Keltner in 1960. The indicator is somewhat similar to the forex Bollinger Bands indicator and Envelopes. It uses three color plot lines: the middle line is the 10-day simple moving average(SMA) applied to the typical price ((high + low + close) / 3), and the upper and the lower bands are produced by adding and subtracting the forex moving average(MA) of the daily price range (High and Low difference) from the middle color line. This way, a volatility-based channel is built. In this version of the forex indicator, you can modify all the parameters of the MA. The forex indicator is available both for MT4 and MT5 versions of the platform.
- MA_Period (main default = 10) — the period of the moving average (middle line).
- Mode_MA (main default = MODE_SMA) — the mode of the moving average(MA) middle line.
- Price_Type (main default = PRICE_TYPICAL) — the applied price of the moving average(MA) middle line.
Example and Forex strategy
The classical forex strategy with this forex indicator is to go long when the price closes above the upper band and go short entry when it closes below the indicator’s lower band. It seems to be a rather viable trade entry strategy. The exits can be based on three main components:
- A very conservative stop-loss (as you see on the chart, false signals are not uncommon).
- Some rather distant take-profit.
- A cross with the middle line.
Some forex traders also suggest using other indicators for confirmation.
Keltner Channel Forex Indicator Download
Keltner Channel for MetaTrader 4 in .zip
Keltner Channel for MetaTrader 5 in .zip
Warning! If you do not know how to set up this forex indicator, please read the MetaTrader Indicators Tutorial.
Do you have any other suggestions or questions regarding this forex indicator? You can always discuss Keltner Channel with the other traders and MQL programmers on the indicators forums.