INDICATOR · BEGINNER GUIDE
KELTNER & DONCHIAN CHANNELS
Two channels that show how far price normally travels, and when it breaks out.
◆Keltner bands◆Donchian 20◆Breakout arrows◆Squeeze check
WHAT YOU SEE · XAUUSD 1H · 22 OCT–2 NOV
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1Blue shaded band: Keltner: EMA 20 ± 2 ATR.
2Orange top step: the highest high of 20 candles.
3Orange bottom step: the lowest low of 20 candles.
4Orange ▲: a new 20-candle high.
5Blue ▼: a close below the Keltner band.
6Many arrows: a strong trend.
Use it in 5 steps
- Switch it onCharts → Basic Indicators (ƒx) → tick Keltner & Donchian Channels.
- Pick a channelIn settings, Show: Keltner, Donchian or Both.
- Inside = normalPrice inside the channel is moving a normal amount.
- Arrow = breakoutA close outside is a strong move. Some carry on, some fail.
- Watch the widthA narrow channel (squeeze) often comes before a bigger move.
A flat range breaks out on gold
XAUUSD 1H, 27 Oct. After a flat, narrow range, gold closed above the 20-candle high (orange ▲) and the Keltner band turned up.
The dashboard
- Keltner: upper half, lower half, or outside the bands.
- Bands: the Keltner prices now.
- Donchian: where price sits in the 20-candle range.
- Channel width: narrow (squeeze), normal or wide.
- Badge: INSIDE, BREAKOUT, NEW HIGH or NEW LOW.
Golden rules
- A volatility tool, not a signal. Check the trend and big news first.
- Breakouts can fail and fall back inside the channel.
- Closed candles only: past arrows never change.
- Always use a stop loss and risk 1% or less per trade.
🔔 Get told when it fires: click Alerts, choose Keltner & Donchian Channels and tick the two Keltner band alerts (or the Donchian ones).
For educational purposes only. The results in this guide come from testing on past prices. Past performance does not guarantee future results, and real spreads, slippage and delays can make results worse. Nothing here is financial advice, and trading carries a high risk of losing money. Read the risk warning.