Placing Channels on Oil Trading Charts on the MT4 Platform
The third option on the insert menu on the MetaTrader 4 oil trading software is the channels button key. Channels button key is used to insert various types of channels on Oil Trading charts on the MT4 platform. The channels button is shown below.
Menu Button For Placing Various Channel Tools in MT4 Software
Channels which can be placed on the crude oil charts are shown on the channels button key menu are:
- Crude Trading Fibonacci Channels
- Linear Regression Channels
- Equidistant Channels
- Standard Deviation Channels
All these channels have different technical analysis and are drawn differently in MetaTrader 4 Oil charts.
Crude Trading Fibonacci Channels
Fibo Channels is a type of channel that is automatically drawn by this Fibonacci Channels button, To draw these Fibonacci channels, a trader selects two points where to draw the same way a oil trend line is drawn on the MT4 platform, once this oil trend points are joined, the Fibonacci channels drawing tool uses these points to draw the first oil trend line & then automatically draws another 5 lines that form channels - these channels are used as profit taking levels to book profits once the crude oil price reaches these points.
Fib levels used to draw these channels are: 0.618, 1.000, 1.618, 2.618, 4.236: The most commonly used channels are the first two channels as shown and illustrated below:
Placing Fibonacci Channels in MT4 Oil Trading Charts
Linear Regression Channels
Linear regression channels are self adjusting channels, which adjusts as channel is plotted from point 1 to point 2, linear regression channels then form what's similar to a crude trading price boundary, this crude trading price boundary shows upper & lower crude trading price boundary & the center point which is the mean for the crude trading price.
These upper and lower channels are used to open trades & close trades and also determine the levels to take profits or set stops for crude oil trades. Linear regression channels are illustrated below:
Placing Linear Regression Lines on MT4 Software
Equidistant Channels
The equidistant channels is the most commonly used channel in oil trading. On MT4 platform, a trader can draw an upward channel or downward channel, the oil example shown below shows an upward Oil Trading channel, once the lower channel is drawn ( oil trend line), the top channel is automatically drawn, a trader can then double click the upper channel to adjust it so that it touches the highest high of crude trading price as shown below - the next time crude trading price touches this line the buy oil trade will then be closed and profit taken. As shown below this was the best crude trading price to take profit when crude trading price in the upward oil trend touched the upper channel.
Placing Equidistant Channels in MT4 Software
Standard Deviation Channels
Standard Deviation channel is similar to Linear Regression channel & it is also used to set the upper and lower boundaries within which crude oil price should move along within. The Standard Deviation channel is displayed and shown below.
Placing Standard Deviation Channels on MT4 Software
