Candle Indicators

Candle indicators (also known as channel or band indicators) are technical analysis tools that use multiple lines to create bands or channels around price action. They help traders identify support and resistance levels, volatility, and potential breakout or breakdown points.

Key Characteristics

• Dynamic Boundaries: Bands or channels that adjust based on market conditions
• Volatility Measurement: Width of bands often indicates market volatility
• Support/Resistance: Outer bands can act as dynamic support and resistance levels
• Breakout Signals: Price movements outside the bands can signal potential trend changes

Common Use Cases

1. Range Trading: Trade within the boundaries when markets are ranging
2. Breakout Trading: Identify when price breaks out of established channels
3. Volatility Assessment: Measure market volatility through band width
4. Risk Management: Set stop-loss and take-profit levels based on bands