# Donchian Channels

Calculate Donchian Channels to identify breakouts and trading ranges using highest high and lowest low

Donchian Channels plot the highest high and lowest low over a period, creating a channel that tracks price range. Breakouts above the upper channel or below the lower channel often signal trend continuation.

## Problem

You want to identify breakout levels and trading ranges. Moving averages smooth price but don't show clear breakout levels. Donchian Channels show exactly where price needs to go to break out of its recent range.

## Solution

```questdb-sql demo title="Calculate 20-period Donchian Channels"
DECLARE
  @symbol := 'EURUSD',
  @lookback := '$now - 2d..$now'

WITH channels AS (
  SELECT
    timestamp,
    symbol,
    close,
    max(high) OVER w AS upper_channel,
    min(low) OVER w AS lower_channel
  FROM market_data_ohlc_15m
  WHERE symbol = @symbol
    AND timestamp IN @lookback
  WINDOW w AS (
    PARTITION BY symbol ORDER BY timestamp
    ROWS BETWEEN 19 PRECEDING AND CURRENT ROW
  )
)
SELECT
  timestamp,
  symbol,
  round(close, 5) AS close,
  round(upper_channel, 5) AS upper_channel,
  round(lower_channel, 5) AS lower_channel,
  round((upper_channel + lower_channel) / 2, 5) AS middle_channel
FROM channels
ORDER BY timestamp;
```

The query calculates:
- **Upper channel**: 20-period highest high
- **Lower channel**: 20-period lowest low
- **Middle channel**: Average of upper and lower

## Interpreting results

- **Price breaks above upper**: Bullish breakout, potential long entry
- **Price breaks below lower**: Bearish breakout, potential short entry
- **Price at middle**: Neutral zone
- **Narrow channel**: Low volatility, breakout likely coming
- **Wide channel**: High volatility, trend in progress

:::note Turtle Trading
Donchian Channels were famously used by the Turtle Traders. Their system entered on 20-day breakouts and exited on 10-day breakouts in the opposite direction.
:::

:::info Related documentation
- [min/max window functions](/docs/query/functions/window-functions/reference/#min)
- [Window functions overview](/docs/query/functions/window-functions/overview/)
:::