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Trading using Donchian Channels

  • #1
  • First Post: Edited 8:49pm Jul 5, 2011 8:28pm | Edited 8:49pm
Well, I am new to the Donchian Channels and I found out about it a few days ago. I like the way Donchian Channels look on the chart.
I intended to open this thread in the "Interactive Trading" section for more traders to post setups with the Donchian Channels but I realized I needed 4 vouches for it in order to do that but anyway I think that "Trading systems" will be a good spot for it as long as we get enough interaction from members.
Here is the indicator I have:
Attached File(s)
File Type: mq4 Donchian Channels.mq4   3 KB | 3,498 downloads

Here are some trades setups taken with multiple Donchian Channels:
Attached Image (click to enlarge)
Click to Enlarge Name: 1.png Size: 39 KB

Attached Image (click to enlarge)
Click to Enlarge Name: 2.png Size: 38 KB

Attached Image (click to enlarge)
Click to Enlarge Name: 3.png Size: 38 KB

I used 6 DCs on the above setups: white period= 4 and purple period =24,34,44, 54, 64.
  • #2
  • Jul 5, 2011 8:56pm Jul 5, 2011 8:56pm
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd.png Size: 37 KB

The DC starts flattening out, the price plays between the white channel and above we have some reverse support. SL=7 pips. Lets see how it goes
  • #3
  • Jul 5, 2011 9:04pm Jul 5, 2011 9:04pm
SL=25 pips. No TP yet
Attached Image (click to enlarge)
Click to Enlarge Name: cadchf.png Size: 36 KB
  • #4
  • Jul 5, 2011 9:27pm Jul 5, 2011 9:27pm
I spent 3 months looking at these. Stopped using them as I couldn't find any reliability in the patterns, they lag terribly.

Price is the best option.

scfx
The best indicator is price.
  • #5
  • Jul 5, 2011 9:30pm Jul 5, 2011 9:30pm
Opinion!

Quoting scfx
I spent 3 months looking at these. Stopped using them as I couldn't find any reliability in the patterns, they lag terribly.

Price is the best option.

scfx
  • #6
  • Jul 5, 2011 9:36pm Jul 5, 2011 9:36pm
Quoting scfx
I spent 3 months looking at these. Stopped using them as I couldn't find any reliability in the patterns, they lag terribly.

Price is the best option.

scfx
I have only few days since I use them and I am in the profit side with it. I didn't calculate profit/ loss but I will in this thread. Thanks

Constin
  • #7
  • Jul 5, 2011 9:40pm Jul 5, 2011 9:40pm
Quoting constin
I have only few days since I use them and I am in the profit side with it. I didn't calculate profit/ loss but I will in this thread. Thanks

Constin
I'm not trying to tear you down, just giving you some feed back. I was using them on 1min 5min and 15min so that may have been my problem.

I was also profitable on some trades, but overall it didn't work for me.

I wish success in making it work. (remember the lag in real time)

Cheers,

scfx
The best indicator is price.
  • #8
  • Jul 5, 2011 9:42pm Jul 5, 2011 9:42pm
post 2 eurusd=-10
I entered new trade eurusd sl=15
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd.png Size: 39 KB
  • #9
  • Jul 5, 2011 9:47pm Jul 5, 2011 9:47pm
Quoting scfx
I'm not trying to tear you down, just giving you some feed back. I was using them on 1min 5min and 15min so that may have been my problem.

I was also profitable on some trades, but overall it didn't work for me.

I wish success in making it work. (remember the lag in real time)

Cheers,

scfx
Not a big deal, you just just gave us your experience with it. I guess we will find out how well it works in the long run.

Thanks, Constin
  • #10
  • Jul 6, 2011 1:35am Jul 6, 2011 1:35am
I am trying to figure out the Take profit Calculation that is harder than the stop loss. Maybe a percentage between channels.
Eurusd is done good so far:
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd1.png Size: 36 KB
  • #11
  • Jul 6, 2011 1:37am Jul 6, 2011 1:37am
Quoting constin
Well, I am new to the Donchian Channels and I found out about it a few days ago. I like the way Donchian Channels look on the chart.
I intended to open this thread in the "Interactive Trading" section for more traders to post setups with the Donchian Channels but I realized I needed 4 vouches for it in order to do that but anyway I think that "Trading systems" will be a good spot for it as long as we get enough interaction from members.
Here is the indicator I have:
Attachment
Here are some trades setups taken with multiple Donchian...
Hi
thanks for sharing, can you please post this template?
thanks
Alex
  • #12
  • Jul 6, 2011 1:51am Jul 6, 2011 1:51am
I have some experience with DC, and to me it looks like good idea but for long term trading. There are several rules you have to follow in order to be profitable:
1. go with the trend (never against it)
2. use daily charts to establish trend and 4H charts to set entry point and sl
3. enter only if interaction with lower or upper band is fully confirmed
4. enter after w "swing" - it means that when you want to sell just wait when price stops going down, then it should touch upper channel and you enter only when price goes down to lower channel again
5. you don't set TP but wait until price goes to satisfying level, or you are dropped by SL
6. move SL along with chanell (if you have short position your SL should be where upper channel is and oposite for long position)
7. number of periods cannot be too small...

When I will have more time (I'm in work right now - there is almost 9 am in Poland ) I will post charts with graphical explanation of what I wrote above
  • #13
  • Jul 6, 2011 2:41am Jul 6, 2011 2:41am
Eurusd is done good so far with low DD and at the moment 70 pips in profit.
I don't know where to place the Tp and as a result I will have to post mostly entries till I figure a way for the tp.
Attached Image (click to enlarge)
Click to Enlarge Name: eurusd3.png Size: 37 KB
  • #14
  • Jul 6, 2011 3:56am Jul 6, 2011 3:56am
Quoting powertrading
Hi
thanks for sharing, can you please post this template?
thanks
Alex
Here it is:
Attached File(s)
File Type: tpl 6DCs.tpl   3 KB | 916 downloads

Don't forget to download the indicator from the post #1
Good luck to us

Constin
  • #15
  • Jul 6, 2011 3:58am Jul 6, 2011 3:58am
Quoting Songo
I have some experience with DC, and to me it looks like good idea but for long term trading. There are several rules you have to follow in order to be profitable:
1. go with the trend (never against it)
2. use daily charts to establish trend and 4H charts to set entry point and sl
3. enter only if interaction with lower or upper band is fully confirmed
4. enter after w "swing" - it means that when you want to sell just wait when price stops going down, then it should touch upper channel and you enter only when price goes down to lower channel...
Thanks,
Constin
  • #16
  • Jul 6, 2011 4:49am Jul 6, 2011 4:49am
Attached Image (click to enlarge)
Click to Enlarge Name: chfjpy.png Size: 35 KB

Attached Image
  • #17
  • Jul 6, 2011 5:06am Jul 6, 2011 5:06am
I wish you much success with your Donchian channel trading. I have spent many hours studying this indicator and I have had some success on the hourly and above time scales. Particular things to study (in my opinion) are when price trades within the channel, not closing outside the edges, so that the channel flat lines, like this:

Attached Image (click to enlarge)
Click to Enlarge Name: usdchf110706h1.gif Size: 28 KB


A tidy (no tail) close outside the channel is a good place to consider the break out trade, especially if it is with the daily or weekly trend and it's off a retracement.
Gone to a better place
  • #18
  • Jul 6, 2011 5:11am Jul 6, 2011 5:11am
Quoting smikester
I wish you much success with your Donchian channel trading. I have spent many hours studying this indicator and I have had some success on the hourly and above time scales. Particular things to study (in my opinion) are when price trades within the channel, not closing outside the edges, so that the channel flat lines, like this:

Attachment

A tidy (no tail) close outside the channel is a good place to consider the break out trade, especially if it is with the daily or weekly trend and it's off a retracement.
Thanks Smikester, I will take into consideration.
Constin
  • #19
  • Jul 6, 2011 5:30am Jul 6, 2011 5:30am
something to share with you guys which is equivalent to Donchian

Attached Image (click to enlarge)
Click to Enlarge Name: Donchian equivalent.png Size: 37 KB
Attached File(s)
File Type: mq4 PriceChannel_Stop_v6.mq4   7 KB | 1,575 downloads
  • #20
  • Jul 8, 2011 6:09am Jul 8, 2011 6:09am
I am trying something different:
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy.png Size: 33 KB
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