KC (Keltner Channel)

Indicator Description

KC (Keltner Channel) is a volatility indicator that reflects the market's volatility range and trend changes by calculating the middle line of price and the upper and lower bands based on ATR.

Function Information

• Function Name: KC
• Input Parameters: High, Low, Close
• Parameter Settings: timeperiod1 (default: 21), timeperiod2 (default: 13)
• Output: up, low

Calculation Principle

KC forms a price channel by calculating the middle line (moving average) of price and the upper and lower bands based on ATR. When the price breaks above the upper band, it indicates overbought; when the price breaks below the lower band, it indicates oversold.

Application Scenarios

1. Volatility range judgment
2. Overbought and oversold analysis
3. Trend strength confirmation
4. Trading signal generation

Usage Suggestions

1. Price breaking above the upper band can be seen as a sell signal
2. Price breaking below the lower band can be seen as a buy signal
3. Use in combination with the middle line
4. Pay attention to changes in channel width