# Donchian Channels Trading Strategy

Enters long or short based on Donchian channel breakouts and sets stop loss and target levels.

Canonical: https://prismaticalgos.com/compendium/algo/2508-donchian-channels-trading-strategy
Record ID: 2508
Catalog rank: 2852 (reading order, not performance)
Snapshot: 2026-10-31 15:46 UTC
Family: Trend Following & Directional (A)
Source: https://www.prorealcode.com/topic/donchian-channels-trading-strategy/
Evidence label (unverified): source_code

## Scope and limitations

These are machine-extracted research records, not verified trading systems. Catalog rank measures specification detail and claimed evidence, not profitability. The catalog extraction pipeline did not independently backtest these records. Its separate selected testing ledger does not validate the wider corpus. Rules, labels and parameters can be incomplete or wrong; consult the original source and its reuse terms.

No endorsement, ownership claim or source-code reuse permission is implied.

## Extraction warnings

No automated warnings recorded; this is not validation.

## Recorded profile

- symbols: Not specified
- timeframes: Not specified
- sessions: Not specified
- market_regime: trending|volatile

## Indicators

- Donchian Channel: {"LookBack": 50, "N": 40}; applied to: high, low
- SMA: {"period": 200}; applied to: close

## Recorded long-entry rules

- close > SMA(200)
- UpperDonchian < UpperDonchian[1]
- UpperDonchian[1] = highest[LookBack](UpperDonchian[1])

## Recorded short-entry rules

- close < SMA(200)
- LowerDonchian > LowerDonchian[1]
- LowerDonchian[1] = lowest[LookBack](LowerDonchian[1])

## Recorded exit rules

- OnMarket and NewSL > 0

## Recorded filters

- Not specified.

## Risk controls

- Stop loss: abs(close - LowerDonchian[1]) for long, abs(close - UpperDonchian[1]) for short
- Take profit: 200 pips
- Position sizing: 1 contract