Placing Channels on Charts on the MT4 Platform

The third option on the insert menu on the MT4 trading software is the channels button. Channels button is used to insert various types of channels on Commodity Trading charts on the MetaTrader 4 platform. The channels button is displayed below.

Menu Button For Placing Various Channel Tools on The MT4 Trading Platform

The channels that can be placed on charts are described on the channels button menu are:

1. Commodities Trading Fib Channels
2. Linear Regression Channels
3. Equidistant Channels
4. Standard Deviation Channels

All these channels have different analysis & are drawn differently in the MT4 charts.

Commodities Trading Fib Channels

Fibonacci Channels is a type of channel that is automatically drawn by this Fibo Channels button key, To draw these Fibonacci channels, one chooses 2 points where to draw the same way a trend line is drawn on the MT4 platform, once this trend points are joined, the Fib channels drawing tool uses these points to draw the first trend-line and then automatically draws another 5 lines that form channels - these channels are then used as profit taking levels to take profits once the trading price reaches these points.

Fib areas used to plot these channels are: 0.618, 1.000, 1.618, 2.618, 4.236: The most commonly used channels are first two channels as shown and illustrated below:

Placing Fibonacci Channels on MetaTrader 4 Trading Charts

Linear Regression Channels

Linear regression channels are self adjusting channels, which adjusts as the channel is plotted from point 1 to point 2, linear regression channels then form what is similar to a trading price boundary, this trading price boundary shows upper & lower trading price boundary and the center point which is the mean for the price.

These upper and lower channels are used to open trades and close trades and also determine the levels to take profits or set stops for trades. Linear regression channels are described below:

Placing Linear Regression Lines on MetaTrader 4 Trading Platform

Equidistant Channels

The equidistant channels is the most oftenly used channel in commodities trading. On MT4 trading platform, one can draw an upward channel or down ward channel, the commodity example illustrated and explained below portrays an upward Commodity Trading channel, once the lower channel is drawn ( trend line), the top channel is automatically plotted, one can then doubleclick the upper channel to adjust it so that it touches the highest high of trading price as described below - the next time trading price touches this line the buy commodity trade will then be closed and profit taken. As described below this was the best trading price to take profit when trading price in the upward commodity trend touched the upper channel.

Placing Equidistant Channels on MetaTrader 4 Trading Platform

Standard Deviation Channels

Standard Deviations channel is similar to Linear Regression channel & it's also used to set the upper & lower boundaries within which price should move along within. The Standard Deviation channel is highligthed and shown below.

Placing Standard Deviation Channels on MetaTrader 4 Trading Platform