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