# Classical Tools for Analysis: Levels and Channels

A modern fix api trader is in a constant search of an ideal combination of trading techniques that would bring him a high and regular income. However, whatever the trading approach or system is, there are technical elements that have been used on the market for more than hundred years and the first postulates on them were written back in the late 19th century. This is a classic approach. It is this method that employs approximately 90% of all players on the market. Entire trading strategies and even algorithms are built on the classical elements.

Today, I propose you to consider two of the simplest and at the same time the most sought after elements of classical analysis: levels and channels. In addition to the simple theory, I’ll tell you a few tips on how you can easily find them.

Levels

The classical level approach can also be divided into two types: support and resistance levels. The difference between this and that approach is that each of them displays zones that will become reversal after growth/decrease or after correction. This is, in fact, the essence. The level of resistance is the future zones that were achieved in the past. The level of support is the past zones, which formed in the course of the current price movement. In order to understand the levels in more detail, I propose to consider the following schedule.

As you can see, the price is clearly moving from one level to another level and after testing one zone it goes to the opposite side.

Advice on detecting levels: mark the maximum and minimum on the graphic and then set the level in the range where the price lasted the longest time. After that, this range is also limited by lines from the top and bottom of the corridor. Thus, you will get at least 4 goals, to which the price will move.

Level trading has a small risk. Typically, when opening a trade, stop loss is set behind the line. And if there is a rebound, the risk in such fix api trading will be minimal in points. If you take into account the trading signals (https://1sforexsignals.com/ ) at the level of breakdown, the risks are certainly higher.

Channels

This technical element is also based on two lines, but unlike support and resistance, the channels tend to have a more oblique structure. The channel displays the price direction and allows you with a great accuracy to predict the maximum volatility of the trading asset. For this, I also propose you to consider a specific example.

As you can see, this channel displays the directed asset movement. The price of the financial instrument has been repeatedly tested on the border of the channel and is now on the average of its range. Thus, we can say with a high probability that the price will continue its movement in this range, and in case of breakdown, the fix api trader will get a call to action.

The channel allows you to understand the price range between which the price will move in future, and this is very important, because in this case, you can analyze the time factor.

Signals to action on the trade channel is directly its breakdown and fixation – this tells us that the price is accelerating and we should expect an impulse. Also, the signal to action is a breakdown from the channel’s borders, which tells the fix api trader about the continuation of the trend movement.

The use of a particular classical method on the fix api forex market can ideally be combined with different trading strategies. So, if you work on a breakdown after crossing the sliding (https://www.metatrader5.com/en/terminal/help/indicators/trend_indicators/ma ) or the price channel, then you can use the channel to understand the phase of the trend and if the breakdown is in the direction of the channel, you can make a deal. If the breakdown of your strategy happened inside the channel and at the same time against its global movement, then such trading signal can be missed.

The classical elements of analysis from several years have proved their efficiency. I’m more than sure that if you learn these principles in your trading, this will improve your trading result.