Horizontal Channel

A horizontal channel is a chart pattern formed by drawing two parallel trendlines above and below the price.

  1. Pattern Description:

    • The upper trendline defines the resistance level.

    • The lower trendline acts as support.

    • Unlike ascending or descending channels, a horizontal channel has equal highs and lows.

  2. Horizontal Channel as Support and Resistance:

    • When the price is between support and resistance, it doesn’t signal a specific future price direction.

    • Breakouts:

      • A break above the upper resistance trendline suggests a bullish trend.

      • A break below the lower support trendline indicates a bearish trend.

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