Placing Channels on Charts in the MetaTrader 4 Platform Software

The third option on the insert menu on the MetaTrader 4 software is the channels button. The channels button is used to insert various types of channels on charts on MetaTrader 4 platform software. The channels button is illustrated below.

Menu Button for Placing Various Channel Tools on the MetaTrader 4 Platform

The channels that can be placed on currency charts are displayed & shown on the channels button menu are:

Forex Fibonacci Channels
Linear Regression Channels
Equidistant Channels
Standard Deviation Channels

All these channels have different trading analysis and are plotted differently on the MT4 charts.

FX Fib Channels

Fibo Channels is a type of channel that is mechanically/automatically drawn by this Fib Channels button, To draw these Fib channels, one selects 2 points where to draw the same way a trend-line is drawn on the MetaTrader 4 platform software, once this trend points are joined, the Fib channels drawing tool uses these points to draw the first trend-line and then automatically draws another 5 lines that form channels - these channels are used as profit booking levels to book profits once the price reaches these points.

Fib levels used to draw these channels are: 0.618, 1.000, 1.618, 2.618, 4.236: The most often used channels are the first two channels as shown below:

Placing Fibonacci Channels on MetaTrader 4 Charts

Linear Regression Channels

Linear regression channels are self-adjusting channels, that adjusts as channel is drawn from point 1 to point 2, linear regression channels then form what is similar to a price boundary, this price boundary shows upper and lower price boundary and the center point which is the mean for the price.

These upper and lower channels are used to open trade positions & close trades and also determine the levels to take profits or set stops for currency trades. Linear regression channels are shown below:

Placing Linear Regression Lines on MT4

Equidistant Channels

The equidistant channels is the most oftenly used channel in Forex trading. On MetaTrader 4 software, one can draw an upward channel or down ward channel, the example below shows an upward Forex channel, once the lower channel is drawn (trend line), the top channel is mechanically drawn, one can then doubleclick the upper channel to adjust it so that it touches the highest high of price as shown below - the next time price tests/touches this line the buy trade will then be closed & profit taken. As shown below this was the best price to take profit when the price in the upward trend touched the upper channel.

Placing Equidistant Channels on MT4

Standard Deviation Channels

Standard Deviation channel is similar to Linear Regression channel & it is also used to set the upper & lower boundaries within which price should move within. The Standard Deviation channel is highlighted and shown below.

Placing Standard Deviation Channels on MetaTrader 4 Online Forex Software

Learn More Topics & Courses:

Trade Forex Trading

Placing Channels on Charts in the MetaTrader 4 Platform Software

FX Fib Channels

Linear Regression Channels

Equidistant Channels

Standard Deviation Channels