Predictive Channels
By LuxAlgoOct 12, 2023
Predictive Channels is an indicator on Vela, our next-generation charting platform, written in Pine Script®.
Predictive Channels estimates the market's underlying linear trend in real time and frames it with five lines: an average at the center, two resistance levels above, and two support levels below, ready-made support and resistance areas that follow the trend as it develops. Shading makes the state legible at a glance: green while price holds above the estimated trend, red while it sits below.
How to Trade the Predictive Channels?
- Green highlight: price is running above the estimated trend, a bullish variation in progress.
- Red highlight: price is below the estimate, the bearish counterpart.
- Channel extremes: the outer support and resistance levels are the natural places to watch for reactions while the current estimate holds.
- Channel renewal: when price deviates significantly from the estimated trend, a new channel prints automatically. Read renewals as the market changing character rather than as noise.
Two inputs govern the whole behavior. Factor decides how much deviation is tolerated before a redraw, so higher values produce longer-lived channels; Slope shapes how steeply those channels run.
Predictive Channels Settings
- Factor: multiplicative factor controlling how far price can stray from the estimated trend before a new channel is created. Higher values allow more distance and fewer updates.
- Slope: sets the steepness of the channel lines; lower values make them steeper, which leads prices to deviate faster and channels to recalculate more often.
Frequently Asked Questions
Free to use
Run it on Vela. Go further with a paid plan.
- Up to 500 Custom Alerts, with webhook automation
- Up to 10× the chart history of Free
- Orderflow lookback up to full history
- More Quant usage to customize it, plus extra usage when you need it
- Futures data alongside crypto, stocks, forex and commodities
Also works on
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