Price Channels

Definition ∞ Price channels are a technical analysis tool used to identify the upper and lower boundaries within which an asset’s price typically trades. These channels are formed by parallel trend lines that connect a series of price highs and lows. They help traders identify potential support and resistance levels. Price channels indicate the prevailing direction and volatility of a market.
Context ∞ In cryptocurrency news, technical analysts often reference price channels to predict future movements and assess the strength of current trends for digital assets. Discussions frequently involve whether an asset is trading within an established channel or if a breakout or breakdown is imminent. A critical future development involves the integration of AI-driven analytics to identify and interpret these channels with greater precision.