This type of strategy works well in trending markets in virtually any time frame. The previously opened long position should be closed here.Īnalogous actions can be carried out in a downtrend. LRF(100) changes its direction from upward to downward.This is another opportunity to open a long position. LRF(300) continues to be upwards and price crosses LRF(100) upwards.This is a signal to close a long position. LRF(100) changes direction to downward.This is a signal to take a long position. The Linear Regression Forecast with a period of 300 is used to give us an indication of the main trend. One by one according to the numbering I will discuss what actions you could have taken to trade successfully. The first has a period of 100 and the second has a period of 300. The above chart adds 2 Linear Regression Forecast indicators. Please take a look at the GBPUSD chart below. Opening transactions according to the direction of the Linear Regression Forecast (LRF100)Īnother approach says you can enter trades at the crossings of the price with the Linear Regression Forecast.Īlso, you should consider the possibility to add the Linear Regression Forecast indicator with the longer period as a filter. Close a long position when the indicator turns down. So if you have a short transaction opened, you should end it when the indicator begins to rise. It can be also an indication to exit your trade. Therefore a general rule is to open a long transaction when the Linear Regression Forecast begins to move upwards and a short transaction when it starts to fall. Trading signals are produced when the indicator changes its direction. Using the Linear Regression Forecast is recommended during a strong trend. Using the Linear Regression Forecast in trading You can, however, adjust the period according to your needs.
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The indicator comes with default settings.
HOW TO USE LINEAR REGRESSION FORECAST INDICATOR HOW TO
How to insert the Linear Regression Forecast indicator on IQ Option You can find it in the group of trend indicators. To add the indicator click on the indicators icon and find the Linear Regression Forecast on the list. Think about the asset you wish to trade and the amount of money to invest. You must be logged in to your trading account. On the other hand, it is more susceptible to whipsaws. In a way, it is similar to moving averages but it responds faster to changes in the price direction and thus shows less delay. It is plotted the endpoints of the entire set of linear regression lines generated on subsequent days. You will be able to identify the trend with many indicators and the Linear Regression Forecast is one of them. Introduction to the Linear Regression Forecast indicator
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2 Using the Linear Regression Forecast in trading.1 Introduction to the Linear Regression Forecast indicator.