Placing Channels on Commodities Trading Charts on the MT4 Software
The third option on the insert menu on the MT4 software is the channels button. The channels button is used to insert various types of channels on Commodity Trading charts in MetaTrader 4 platform. The channels button is shown below.
Menu Button For Placing Various Channel Tools on The MT4 Commodity Software
The channels that can be set on the commodities trading charts are shown on the channels button key menu are:
- Commodities Trading Fib Channels
- Linear Regression Channels
- Equidistant Channels
- Standard Deviation Channels
All these channels have different technical analysis & are drawn differently on the MT4 Commodity Trading charts.
Commodities Trading Fib Channels
Fibo Channels is a type of channel that's automatically drawn by this Fibo Channels button key, To draw these Fib channels, a trader selects 2 points where to draw the same way a commodity trend line is drawn on the MetaTrader 4 platform, once this commodity trend points are joined, the Fibonacci channels drawing tool uses these points to draw the first commodity trend line & then automatically draws another 5 lines that form channels - these channels are used as profit taking levels to book profits once the commodity price reaches these points.
Fib areas used to plot these channels are: 0.618, 1.000, 1.618, 2.618, 4.236: The most commonly used channels are first two channels as illustrated and shown below:
Placing Fibonacci Channels on MT4 Commodity Trading Charts
Linear Regression Channels
Linear regression channels are self adjusting channels, which adjusts as the channel is plotted from point 1 to point 2, linear regression channels then form what is similar to a commodity price boundary, this commodity price boundary shows upper and lower commodity price boundary and the center point which is the mean for the commodity price.
These upper and lower channels are used to open trades & close trades and also determine the levels to take profits or set stops for commodities trades. Linear regression channels are illustrated below:
Placing Linear Regression Lines in MetaTrader 4
Equidistant Channels
The equidistant channels is the most oftenly used channel in commodity trading. On MT4 platform, a trader can draw an upward channel or downward channel, the commodities trading example shown below shows an upward Commodities Trading channel, once the lower channel is drawn ( commodity trend line), the top channel is automatically drawn, a trader can then double click the upper channel to adjust it so that it touches the highest high of commodity price as shown below - the next time commodity price touches this line the buy commodity trade will then be closed and profit taken. As shown below this was the best commodity price to take profit when price in the upward trend touched the upper channel.
Placing Equidistant Channels in MetaTrader 4
Standard Deviation Channels
Standard Deviation channel is similar to Linear Regression channel and it is also used to set the upper & lower boundaries within which commodities price should move along within. The Standard Deviation channel is displayed and shown below.
Placing Standard Deviations Channels in MetaTrader 4
