The Turtle Trading Channel is a breakout-based trend-following system that helps forex traders identify strong market trends, trade breakouts, and optimize risk management. In this guide, we’ll explore how the Turtle Trading Channel works, its advantages, and the best strategies to trade with it effectively.
The Turtle Trading Channel is a breakout trading system developed by Richard Dennis and William Eckhardt for their famous Turtle Traders experiment. It consists of price channels that help traders identify strong breakouts and trend continuations.
The system includes:
These channels plot the highest high and lowest low over the chosen period, forming a dynamic support and resistance structure.
The Turtle Trading system is built around breakout trading:
For long-term trades, traders use the 55-period breakout:
The system includes a stop-loss rule based on the Average True Range (ATR):
Pairing the Turtle Trading Channel with a moving average (e.g., 50 EMA) helps confirm trade entries:
✅ Pros:
❌ Cons:
The Turtle Trading Channel is a powerful breakout and trend-following system that helps forex traders catch major price moves and manage risk effectively. When combined with ATR stop-loss, moving averages, or price action strategies, the Turtle Trading system enhances trade accuracy and consistency.
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