Donchian Channel

The Donchian channel indicator, also known as Price Channel, was developed in the beginning of the 1970s by Richard Donchian. He is famous for his technical analysis of financial markets. Price Channel belongs to trend following indicators and is similar to well known Bollinger Bands indicator by its signals and layout. However, unlike Bollinger Bands, Donchain's price channels are based on high and low prices over a certain period of time.

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InstaForex Donchian Channel Parameters

period - 20
displacement - 2
mode - 1 or 2

When mode = 1, indicator is based on Highest High and Lowest Low of the last n periods

When mode = 2, indicator is based on Close of the last n periods


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