Signing up is free and takes 5 secs only…
Donchian channel is the trend indicator that helps us to identify the current trend and direction. This indicator uses three lines and is really easy to use. In, this blog I will teach you everything about the Donchian channel and the correct way of using the Donchian channel with RSI in Olymp Trade.
Setting up the Donchian channel and RSI in Olymp Trade
Setting up the Donchian channel in Olymp Trade is very easy. Once you have signed up you will land on the Olymp trade dashboard.
Now, click on the indicator button and select the Donchian channel from the menu.
Similarly, select the indicator button and select RSI from the menu.
That’s it!! The basic setup is over.
What is the Donchian channel indicator?
The Donchian Channel is one of the most popular technical indicators of all time. This indicator is used by traders to identify the possible trend & reversals. This indicator was developed by one of the greatest of all time Richard Donchian in 1970. While trading financial derivatives you need to make assumptions about the price movements. Your success depends on the ability to identify the possible trend & its reversal and the Donchian channel will help you do that.
This indicator uses three lines to identify the trend:
Upper line: This line is at the top of the lines and it takes the highest value per n periods.
Lower Line: Similarly, This line is at the bottom of three lines and it takes the lowest value per n periods.
Midline: This line takes the average of the upper line and the lower line.
How to place Trade with RSI and Donchian channel in Olymp Trade?
When the Donchian channel upper line is in a plunge or falling position plus the RSI line is near the overbought level . It signals a strong bearish trend and here, we should take a sell trade. Given above is a 1-hour chart, and as we can see above that the Donchian channel upper line is in a falling position plus the RSI line is near the overbought level.
Similarly, when we see the Donchian channel lower line is in a rising position plus the RSI line is near the oversold level It signals a strong bullish trend and here, we should take a buy trade. Similarly, Given above is a 1-hour chart, and as we can see above that the Donchian channel lower line is in a rising position plus the RSI line is near the oversold level so here, we should take a buy trade.
Donchian Channel is one of the most popular trading indicators that uses three lines including the upper line, middle line, & lower line.
This indicator was developed by one of the most famous names in the field of trading Richard Donchian.
Richard Donchian is one of the most legendary figures in the field of trading. He has done a lot for our trading community.
In 1949, He organised the first futures fund futures Inc. which became the prototype of mutual funds in the United States.
In addition, he created a well-known system of turtles. In the early 1970’s he developed a so-called sliding channel, which was later named after him Donchian channel.
Here, In this article. I have covered the easy Donchian Channel Strategy with RSI. You just need to remember the easy golden rule.
In this article, I have covered Donchian Channel Strategy, Donchian channel indicator, Channel Breakout Strategy, Donchian channel trading, Channel Trading, Channel trading strategy & more