Linear Regression Analysis & Linear Regression Trade Signals

Another name for a regression line is a line of the best fit/best fit line. This indicator plots the trend of the price over a specified duration of time. The market trend is determined by calculating a Linear Regression Trendline using "least squares fit" method. This method helps to minimize the distance between the price data points and the line of best fit.

Linear Regression Trading Indicator - MT4 Linear Regression Trading Indicator - Linear Regression Trading Indicator Free Download

Unlike the straight Regression Trendline indicator, the technical indicator plots the end values of multiple Linear Regression trend lines. Any single point along the Linear Regression will be equal to the end value of a Regression Trendline, but resulting trend-line resembles the MA Moving Average.

But unlike the MA Moving Average, this trading indicator doesn't show as much delay since it's fitting a line onto data points rather than averaging them.

The Linear Regression is a prediction of the tomorrow's trading price drawn today, one day before. When the prices are steadily higher or steadily lower than the forecasted price, then a gold trader can expect them to return quickly to the more realistic fore-casted levels.

In other words, this indicator shows where the chart prices "should" be trading based on a statistical basis and any dis-proportionate deviation from the regression line is likely to be short lived.

Gold Analysis and How to Generate Signals

This trading indicator allows for the price selection, adjusting number of periods and smoothing out of price info before applying the calculation & the selection of smoothing type.

This indicator resembles a Moving Average but it has a bi-color representation.

Bullish Signal (Blue color) - A rising line (greater than its previous value one previous bar before) is displayed in the up-trend blue colour, while
Bearish Signal (Red colour) - a falling line (lower than its previous value one previous bar before) is displayed in the down-trend red color.

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Linear Regression Analysis & Linear Regression Trade Signals

Gold Analysis and How to Generate Signals