TradeAlmanac
Sign in

Donchian channel

Boundaries built from the highest high and the lowest low over a chosen number of recent intervals.

How to read the number

It marks the edge of a range that already happened. A boundary only moves after a new extreme has been set, so it is late by construction.

When the metric lies

In sideways movement the boundaries close in and exits follow one another without continuation, each looking like the start of something.

Also known as: donchian channel

Related terms