Frequently Asked Questions

What is the Keltner Channel used for?

The Keltner Channel is used to identify trade opportunities in swing action
as prices move within an upper and lower band.
Who was Chester Keltner?
The Keltner Channels were originally developed by market technician
Chester Keltner in his 1960 book How to Make Money in Commodities.
Keltner dies in 1998 at the age of 89.2
What is the difference between the Keltner Channel and Bollinger
bands?
Both technical indicators are similar; however, the Keltner channel utilizes
average true range (ATR) while Bollinger bands use standard deviation.
Are Keltner Channels or Bollinger bands a better metric?
Both metrics are useful, but for producing different signals. Like Bollinger
Bands®, Keltner Channel signals are produced when the price action
breaks above or below the channel bands. Here, however, as the price
action breaks above or below the top and bottom barriers, a
continuation is favored over a retracement back to the median or
opposite barrier.
What is a Keltner Channel strategy?
If the price action breaks above the band, the trader should consider
initiating long positions while liquidating short positions. If the price
action breaks below the band, the trader should consider initiating short
positions while exiting long or buy positions.