Equidistant Channel is a technical analysis indicator used to identify potential trading opportunities. It is created by plotting two parallel lines an equal distance above and below a central moving average. The most common type of Equidistant Channel is the 4-period Equidistant Channel, which uses a 4-period moving average as the central line.
Equidistant Channels can be used to identify both bullish and bearish trading opportunities. When the price is above the upper line of the channel, it is considered to be in a bullish trend. When the price is below the lower line of the channel, it is considered to be in a bearish trend. The direction of the trend can be confirmed by looking at the slope of the moving average. A rising moving average indicates a bullish trend, while a falling moving average indicates a bearish trend.
