Equidistant Channel

Equidistant Channel represents two parallel trend lines connecting extreme maximum and minimum close prices. Market price jumps, draws peaks and troughs forming the channel in the trend direction. Early identification of the channel can give a valuable information including that about changes in the trend direction what allows to estimate possible profits and losses. It is necessary to give the direction of the channel and its width to build the instrument.

Channel

There are line studies being largely used in technical analysis and helping to define channels and trend changes. These instruments are:

• Linear Regression Channel
• Equidistant Channel
• Standard Deviation Channel