|
The Keltner channel is a market analysis indicator that measures the movement of stocks in relation to a central moving average line, as well as upper and lower channel lines. The Keltner channel indicator is primarily used by savvy investors to predict market trends. There are two bands on a Keltner channel, which are drawn above and below an exponential moving average. The Keltner channel is based on the Average True Range. An overbuy is indicated on the Keltner channel when prices rise above the upper band, and an oversell is indicated on the Keltner channel when prices fall below the lower band. Because the Keltner Channel was created to take advantage of volatility swings and follow market trends, it is not effective in sideways markets. The Keltner channel is named after Chester W. Keltner, a grain trader and author of the 1960's book How to Make Money in Commodities. |
