Keltner Channel
Volatility Indicator
Keltner Channel
Keltner Channels are volatility-based bands placed above and below an exponential moving average.
Overview
Keltner Channels use the Average True Range (ATR) to set channel distance. The channels expand when volatility increases and contract when volatility decreases. Price touching or breaking the bands can signal potential trading opportunities.
Use Case
Useful for identifying trends, breakouts, and overbought/oversold conditions.
Calculation
Middle Line = EMA, Upper Band = EMA + (2 × ATR), Lower Band = EMA - (2 × ATR)