Currently using it to identify stops not really as a buy/sell signal. Does anyone here have any experience using this vs. Bollinger Bands? How has it been for you?
I never use keltner channel, so i cant comment about it
But if ur strategy use a channel or band (i use BB to)
I think there is 3 scenario if price touch BB
- Reversal
- Retracment
- Breakthrough like champion
So we must be a flexible trader,
at early we will make a lot mistake ,
but experience and price action understanding will help a lot
Just 2 cent from novice
I never heard about Keltner channel. Would you please explain it first?
It’s basically like a BB but instead uses the ATR for the last 10 days and multiplies it by 2 - those serve as the upper and lower channels. Meanwhile BB uses standard deviation.
I know Tom Basso uses it in his trend following strategies. I have been looking into, but have not use them in a strategy yet. Looking to do some back testing 1st. Have you performed any back testing with KC bands?
Nah haven’t done anything like that yet. Will look up Tom Basso though!
Some signals from Keltner Channels work others not. Only simulation on historical data will show what does your strategy worth. I’m not a fan of telling something definite about success of patterns of technical indicators but Keltner channels did help me to increase winning ratio in my trading with Hotforex because I use it through autochartist. Learn if your broker offers that.
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I have an EA using Keltner Channels, it’s nothing special, but if combined with other indicators cn produce a good combo.
Ah I just use TV then input orders separately.
Which indicators play well with Keltner Channels in your experience?
ATR, RSI and variations of those momentum indicators. Basically the reasoning behind choosing indicators is simple: understand what is the basic principle of your trading system (following trend, hunting momentum, playing long-term relying on price fundamentals) and then choose indicators which can serve as a confirmation of your trading principle.
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Agreed. Will try to pair it with those. Currently using ROC and some MAs.
Although do you feel like with this current environment, indicators aren’t really (at least sometimes) of much help?
Yeah, it can be the case but you know making trades based on “naked eye” analysis, intuitive decisions create impression that your trading is dumb. We forced to think that we need to use some additional information because it makes us confident.
However if you take an intuitive trader and a trader that uses bunch of indicators or generates signals with some sophisticated trading system (without clear market edge like speed of execution, insider information) you can’t prove that second trader is better. They both have equal chances that their trading performance is purely random.
exactly,if there is a good system and he can follow it like an algo- it can be great. I ve seen it,but also he combines it with experience. So it is not bells and whistles only.