Linear Regression Slope Expert Advisor Setup - Setting Up Linear Regression Slope Expert Advisor

Linear Regression Slope Expert Advisor Setup - Setting Up Linear Regression Slope Expert Advisor - A trader can come up with an Linear Regression Slope Expert Advisor based on the Linear Regression Slope indicator explained below.

Linear Regression Slope Expert Advisor rules can be combined with other Forex indicators to come up with other EA Bots that trade using rules based on two or more indicators combined to form a system.

Linear Regression Slope Forex Analysis Signals

Linear Regression Slope indicator calculates the slope/gradient value of regression lines which involves the current price bar & the previous n-1 price bar (where n = regression periods)

This Indicator calculates this value & updates it for each price candlestick loaded in the price chart.

The Indicator is calculated from the Linear Regression Indicator. The linear regression plots the trend of the price chart over a specified duration of time and this market trend is determined by drawing a Linear Regression Trend-Line using the "least squares fit" method. The slope of this trendline is then calculated and this forms the linear regression.

Linear Regression Slope - Linear Regression Slope EA Setup

The slope values are then smoothed by multiplying the raw slope indicator values by 100 & then dividing this value by price

Linear Slope Regression = (raw value of slope * 100 / price).

The smoothing of the slope values is essential when comparing markets that are volatile and trade within wide price ranges for each price candle. Smoothed slope value will show the percent change in the price per every candlestick used to calculate the regression (best fit) line.

Forex Analysis and Generating Signals

• If the smoothing of the slope is 0.30, then the regression line is rising and adjusting at a rate of 0.30% for every candlestick.
• If the smoothing of the slope of -0.30, then the regression line is going down and adjusting at a rate of -0.30% for every candlestick.

The regression slope is displayed as a bi-color histogram that oscillates above & below zero center line. Center-line that's used to generate Forex signals is set at the 0 level.

• A rising slope (greater than the previous value of 1 candle ago) is displayed in the Blue/Upward Slope color,
• A declining slope (lower than the previous value of 1 candlestick ago) is displayed in the Red/Downward Slope color.

Analysis - Linear Regression Slope Expert Advisor Setup