Setting Channels in Stock Index Charts on the MetaTrader 5 Platform
The third option on insert menu on MetaTrader 5 software platform is the channels button. The channels button is used to insert various types of channels on Indices Trade charts in MT5 platform. The channels button is shown and illustrated below.
Menu Button Key for Placing Various Channel Tools in MT5 Platform
The channels that can be placed on stock charts are pictured on the channels button menu are:
- Indices Trade Fibonacci Channels
- Linear Regression Channels
- Equidistant Channels
- Standard Deviation Channels
All these channels have different stock technical analysis & are drawn differently on the MT5 charts.
Stock Indices Trade Fibonacci Channels
Fib Channels is a type of channel that is mechanically/automatically drawn by this Fibo Channels button, To draw these Fib channels, a indices trader chooses two points where to draw the same way a trend line is drawn on the MT5 Platform, once this trend levels are connected, the Fibo channels drawing tool uses these points to draw the first indices trendline & then automatically draws another five lines which form channels - these channels are used as profit booking levels to take profits once the stock price gets-to these levels.
Fib levels used to draw these channels are: 0.618, 1.000, 1.618, 2.618, 4.236: The most often used channels are first 2 channels just as is displayed and shown below:
Placing Fib Channels on MetaTrader 5 Charts
Linear Regression Channels
Linear regression channels are self-adjusting channels, that adjusts as channel is drawn from point 1 to point 2, the linear regression channels then form what's similar to a indices price boundary, this stock price boundary shows upper & lower stock price boundary & the center point which is the mean for the price.
These upper and lower channels are used to open stock trades and close stock trades and also determine the levels to take profits or set stops for stock trades. Linear regression channels are pictured below:
Placing Linear Regression Lines on the MT5 Software
Equi-distant Channels
The equi-distant channel is the most often used channel in indices. On MT5 platform, a indices trader can draw an upward channel or downwards channel, the stock example illustration explained & illustrated and shown below shows an upward Stock Indices Trade channel, once the lower channel is plotted ( trendline), the top channel is mechanically drawn, a trader can then doubleclick the upper channel to adjust it so that it touches the highest high of stock price as pictured below - the next time stock price touches/tests this line the buy trade will then be closed and profit taken. As pictured below this was the best stock price to take profit when stock price in the upward trend touched the upper channel.
Placing Equidistant Channels in MT5 Software Platform
Standard Deviation Channels
Standard Deviations channel is similar to Linear Regression channel and it's also used to set the upper & lower boundaries within which price should move within. The Standard Deviations channel is displayed & shown below.
Placing Standard Deviations Channels on the MT5 Software
Learn More Lessons and Tutorials & Guides:
- IndexNasdaq Ndx Nas 100 Symbol
- IT 40 Strategy Example
- How to Draw Indices Trend lines Analysis
- How Do You Analyze Indices Price with Different Indices Chart Time Frames?
- How to Trade US100 Training Tutorial for Trading US 100
- MT4 Indices Trade Platform/Software Tutorial
