DEFINITION of 'Keltner Channel'

A volatility based 'envelope' indicator that measures the movement of stocks in relation to an upper and lower moving-average band.

BREAKING DOWN 'Keltner Channel'

This indicator, named after Chester W. Keltner, is used by sophisticated investors to predict the trend of the market. An overbuy occurs when prices move above the upper band, and an oversell occurs when prices move below the lower band.

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RELATED FAQS
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