Channels
Trade using market bounces!
What Are These Bands?
These are dynamic channel bands that adapt to market volatility. The middle line follows the trend, while the outer bands detect extreme price moves where reversals are likely.
The goal: ✅ Catch potential reversals when price pushes outside the band ✅ Trade with the trend using the middle line ✅ Read market consolidation vs breakout
How to Read the Bands
🟣 Purple Arrows = SELL Signal
Price spiked above the upper band
Market is overextended to the upside
Reversal or pullback likely → consider short
🔵 Blue Arrows = BUY Signal
Price dropped below the lower band
Market is oversold
Reversal or bounce likely → consider long
📌 Price likes to return inside the band These signals are often mean reversion entries.
Middle Line: Trend + SR
The middle moving average line follows the main trend
Acts like dynamic support or resistance
Can be used for:
Trend bias (price above = bullish, below = bearish)
Entry point after signal (e.g. reversion to the midline)
Continuation confirmation (price staying on one side = strong trend)
Band Width = Volatility Insight
Wide bands = High volatility / strong trends
Tight bands = Consolidation / ranging market → Often a signal that a breakout is coming soon
Use band width to decide:
Trade smaller in high volatility
Wait for breakout from tight squeeze zones
✅ How to Trade with It
Price above upper band
Purple arrow = SELL
Look for short or TP longs
Price below lower band
Blue arrow = BUY
Look for long or TP shorts
Price returns to midline
Mean reversion in progress
Use for entry or partial exit
Band tightens
Low volatility
Wait for breakout, prepare to trade
Price hugs outer band
Strong trend
Avoid counter-trend, follow momentum
🔁 Summary
🔵 Blue arrow
Buy setup from oversold zone
🟣 Purple arrow
Sell setup from overbought zone
📏 Tight bands
Market is coiling up, breakout near
🚀 Wide bands
Volatile trend — follow direction
➖ Middle line
Trend direction + support/resistance
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