Donchian Channel Breakout Trading Strategy With Momentum Trading Indicator Forex Technical Analysis

Best and Easy Donchian Channel Breakout Trading System and Strategy With Momentum Trading Indicator Forex Technical Analysis. Donchian channels were invented by trader Richard Donchian, one of the pioneers of technical analysis.

Forex-Donchian-Trading

The most successful Donchian Channels Turtle Trader was just 19 years old and was given $2 million USD, which he turned into more than $30 million USD profit. As it turns out, the trading rules they used were actually fairly simple.

The Donchian channel plots two lines on a chart:

  • one line is the highest high over a set period
  • the other line is the lowest low over a set period.

You decide the time frame in question, though the number used in the classic Donchian system is 20 days.

 

Donchian Channel Breakout Momentum Trading Rules

 

Donchian Channel Breakout Trading Strategy With Momentum Trading Indicator Forex Technical Analysis is a trend following trading system based on the ZigZag, Donchian Channel, and Momentum.

  • Best Time Frame : H1 or higher
  • Currency pairs : any
Recommended Article:  Forex High-Probability Multiple Time Frames Trading and Analysis

 

Metatrader Indicators

  • Donchian Cahannel
  • Momentum;
  • FVT Signal ( trend-momentum indicator as confirm indicator).
  • Zig Zagger (212);
  • Zig Zag V.2 (60 , 12);
  • MathTrader7 Legacy volume/spreads (13, 5, 3) mode leg volume;
  • MathTrader7 Legacy volume/spreads (13, 5, 3) mode leg volume per bars;
  • MathTrader7 Legacy volume/spreads (13, 5, 3) mode leg volume per spread;
  • (MathTrader7 Legacy shows the volume of the bullish/bearish legs based on zig zag indicator.)

 

BUY Rules

  • Enter long when price crosses above the 20-Day upper Donchian Channel
  • Buy Arrow blue confirmed by Red bars FVT signal
  • Momentum line downward and below 100 level

 

SELL Rules

Forex-Donchian-Trading-SELL

  • Sell Arrow red confirmed by green bars of Fvt signal
  • Momentum line downward and below 100 level
Recommended Article:  Forex Education & Tutorial - Most Accurate Moving Average TrendLine Trading System for Advanced Trader

 

EXIT Rules

  • Exit when price penetrates a midle Donchian Channel
  • or Exit position is discretionary depends by time frame, make profit with ratio 1:2 or 1:3 stop loss.
  • Stop loss on the previous high/low swing.

 

Forex-Donchian-Trading-SELL



One thought on “Donchian Channel Breakout Trading Strategy With Momentum Trading Indicator Forex Technical Analysis

  • Looks promising. However, why contradict the donchian channel breakout with the subjective pattern indicator? Dont really need it, the rule base is good enough without extra unnecessary indicators. My option ofcourse.

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