How to trade on a horizontal channel
A horizontal channel is a pattern that emphasizes investor indecision. This horizontal channel is composed of two horizontal and parallel lines that build the price trend. To confirm a line, there should be at least two points of contact with the price. The more contact points it will have, the more these will be sustainable and their breakout will give a significant buy/sell signal. The horizontal channel is a familiar chart pattern. It is found on every time frame. Central to this channel, the buying and selling forces are equal and only the breakout of one of the two bands will show an advantage to one of them. The abstract target of the pattern will be calculated by extending the length of the channel on the breakout point. Check the graphical representation of a horizontal channel: the target price of this pattern is determined by its height from the base of the triangle carried across the breakpoint. Try the technique of drawing a parallel line to the support of the symmetrical triangle from the first point of contact with the resistance, which will help to get a bullish target price. The more the horizontal channel is long, the more the movement at the exit will remain strong. Pullbacks are common. The breakout often occurs at the fourth contact point.
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