Alexander Elder's Channel

Hey guys,

Alexander Elder mentioned in his book "Come into my trading room" about an EMA channel that is use to measure performance grade of a trader. I created 2 EMA for open and close set at period 4. Although it covered most of the candles but I wonder if it's the right way to do it. He also mentioned that the channel must cover "95%" of the prices but how do one measure the coverage in percentage?

Anyway actually created this channel to measure your performance grades? I don't trade indicators but PA btw.

bump

I was wondering the same thing... Did you get the answer to this?

it’s called a atr channel.

To ensure it covers "95%" of the prices, you would need to visually inspect the chart to see if the EMAs encompass the majority of the price action. Ideally, very few price points should be outside the channel.