Donchian Channels
Learn the classic Turtle Trading indicator for breakout detection.
What are Donchian Channels?
Developed by Richard Donchian, the "father of trend following." Simply the highest high and lowest low over N periods.
Upper = Highest High (N)
Lower = Lowest Low (N)
Middle = (Upper + Lower) / 2
Lower = Lowest Low (N)
Middle = (Upper + Lower) / 2
Turtle Trading Strategy
- Buy: Price breaks above 20-day high
- Sell: Price breaks below 20-day low
- Exit: 10-day opposite breakout